Monopoly, Oligopoly and Duopoly - An Economic Analysis

MONOPOLY, OLIGOPOLY AND DUOPOLY 1
MONOPOLY, OLIGOPOLY AND DUOPOLY
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MONOPOLY, OLIGOPOLY AND DUOPOLY
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Australia is among the world’s most advanced country in industrialization.
Industrialization is a large enterprise entity that is actively engaged in industrial professional and
commercial activities. An industry is involved in transacting its activities such as manufacturing
goods and providing services to their customers. The main aim of a business industry is to
maximize on profit but there are other businesses that are nonprofit based and are meant for
charitable missions (Webster, 2014).For an industry to be successful, marketing strategies
should be adhered to and most importantly the business market.
Economic theories have helped industrial owners to have a better consideration of the
real-world business associated problems by using economic reasoning to maximize on their
profit. In industrialization, business market is a term that refers relationship between a seller and
a buyer. It includes the selling of products and offering of services to potential business owners
to be consumed or to be assembled to make new products. Monopoly, oligopoly and duopoly are
examples of business fields that comprehend the relationship between the sellers and the buyers
in a market field (Hasbro, 2012). To start with, this is an interesting case study that outlines the
relationship that is there in the market. As an upcoming business owner it is important to be
conversant with the type of relation you ought to imply on in your marketing field. Depicted
below is an economic coherent analysis on Monopoly, oligopoly and duopoly based on the
relationship between business owners and the customers and how they affect the Australian
industry.

MONOPOLY, OLIGOPOLY AND DUOPOLY
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Monopoly
Monopoly is a market structure which has many buyers but only one seller. To get a
better understanding of monopoly, we will look at its description (Hasbro, 2012) Monopoly is a
marketing field that has a single seller, selling their unique products to multiple potential buyers
in the market. In this kind of market, the business owner faces no competition since he/her runs a
sole proprietorship business thus maximizing their profits. One of the advantages associated with
monopoly is that the owner of the business controls the price in the market of his/her products or
services. Monopolies emerge as a result of industries large-scale production of goods and
services thus making the long-run average of production of cost to fall. This makes monopoly to
emerge naturally because of the connection between the scale of operation and the average cost
(Hasbro, 2012).Below is a diagram that shows an industry in Australia with economic scale. The
diagram reflects that as output escalates, the run average cost drops.