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Economics
TABLE OF CONTENTSIntroduction.....................................................................................................................................3Part 1................................................................................................................................................31....................................................................................................................................................32....................................................................................................................................................53....................................................................................................................................................6Part 2................................................................................................................................................71....................................................................................................................................................72....................................................................................................................................................93...................................................................................................................................................94....................................................................................................................................................9Part 3..............................................................................................................................................10Conclusion.....................................................................................................................................13References......................................................................................................................................142
INTRODUCTIONPetroleum industry is one of the highest profit earning sector now days. In the Australiathere are many big corporations those which are paying high tax amount to the government thathelps in economic development of the country. Present report will discuss the market of petrolcompanies in the wholesale sector (Golecha and Gan, 2016). Market structure of petrol station inthe retail sector will be illustrated in this report. Calculation of unemployment rate, LFPR% willbe done in this study.PART 11.a) Market structure of petrol companies in wholesale marketThere are many types of structures such as perfect competition, monopoly, oligopoly,monopolistic competition, contestable market etc. BP, Shell, Caltex, Mobil are the biggest firmswhich are operating in this sector. These firms operate in the Oligopoly market wherein there arefew sellers those which dominate the entire market. They sell homogeneous products to thebuyers (Lade and Bushnell, 2016). It is the type of partial oligopoly market where few firms arelooked as price leaders and they make decision of pricing. In Australia, wholesale market isshared between few petroleum companies and this is highly concentrated. They have power tomake decision of pricing and due to this demand and supply can get affected to great extent.b) Graphical demonstration of price and output in collude situationPrice is the major factor that impact on the overall output to great extent. If four biggestfirms BP, Shell, Caltex, Mobil in Australia get colluded and they charge high prices then in suchcondition demand will get affected to great extent (Sayaka, 2016).3
By comparing the both graphs it can be said that in the Oligopoly market MC and Mr cuteach other and on the bases of that price is being decided. If these petroleum companies enhanceprices then it will affect the output and it will get down. On other hand when it comes to4Illustration1: Graph of oligopoly market structureSource: (Petit, 2015)Illustration2: Competitive market graphSource: (Wang, 2016)
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