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There are basically four different types of Market structures. They vary based on things like number of producers control over prices and barriers to entry or how hard it is for new businesses to jump in the market. Most agricultural products, like strawberries on a type of Market called perfect competition. Individual businesses don't have control over prices one farmer can't convince you to pay pay more if you can buy it from other Farmers for less; monopolies on the other side of the spectrum. There's one large company that produces a product very few substitutes. Has high barriers prevent competition and Monopoly has a lot of controls of price. There are two types of markets in between these extremes monopolistic competition is a market with many producers and relatively low barriers. Their products are very similar, but not identical. This could be something like furniture stores or fast food me McDonald's and Burger King do have noticeably different products one might be able to charge a slightly higher price. If for whatever reason consumers prefer that type of burger, but if either tried to increase their prices a lot and everyone will just go to their competitor and if McDonald's and Burger King both try to raise their prices the same time, some other company will enter the market since the barriers are relatively low. Eg. Domino's introduced their burger & that's what we're Focus on today, OLIGOPOLIES.
OLIGOPOLIES are markets that have high barriers to entry and are controlled by a few large companies oligopolies are all over the place. In fact, their products are likely in front of you right now. The laptop/computer Market is dominated by companies like HP, Dell and apple and the majority of mobile phones are produced by Apple & Samsung . You also see this type of thing in the market for cars are travel/movies and game consoles.Like monopolistic competition, oligopolies often sell products that are similar but not identical and not have much control over their prices. Like everyone loves iPhone but if Apple raise the price of a phone to $3,000 then many will start switching to an Android, but the price of an iPhone is pretty close to the price of a high-end Android.
So how do they compete?
The answer is non-price competition and as you might guess it's competing without changing the price this happens in a lot of Industries companies focus on things like style quality location or service the goal is to distinguish their product from their competitors like the
Let's say...Jeans, that one company sells might be virtually identical to everyone else's in terms of quality. But if you can convince consumers that their logo tag on the butt looks cool well than then you are a step ahead than others. If a company has better customer service or has more convenient locations the most recognizable are some form of non-price competition.
This topic is much more deep and we go on and on, if you want us to make more blogs on such topics please let us know in comment section below…
Hope this blog was informative and helped you in some kind. Feel free to give your suggestion by commenting in the comment section below. Be updated for more post by FOLLOWING/SUBSCRIBING us and following us on social media.Thank You for visiting Info Thirst.
There are basically four different types of Market structures. They vary based on things like number of producers control over prices and barriers to entry or how hard it is for new businesses to jump in the market. Most agricultural products, like strawberries on a type of Market called perfect competition. Individual businesses don't have control over prices one farmer can't convince you to pay pay more if you can buy it from other Farmers for less; monopolies on the other side of the spectrum. There's one large company that produces a product very few substitutes. Has high barriers prevent competition and Monopoly has a lot of controls of price. There are two types of markets in between these extremes monopolistic competition is a market with many producers and relatively low barriers. Their products are very similar, but not identical. This could be something like furniture stores or fast food me McDonald's and Burger King do have noticeably different products one might be able to charge a slightly higher price. If for whatever reason consumers prefer that type of burger, but if either tried to increase their prices a lot and everyone will just go to their competitor and if McDonald's and Burger King both try to raise their prices the same time, some other company will enter the market since the barriers are relatively low. Eg. Domino's introduced their burger & that's what we're Focus on today, OLIGOPOLIES.
OLIGOPOLIES are markets that have high barriers to entry and are controlled by a few large companies oligopolies are all over the place. In fact, their products are likely in front of you right now. The laptop/computer Market is dominated by companies like HP, Dell and apple and the majority of mobile phones are produced by Apple & Samsung . You also see this type of thing in the market for cars are travel/movies and game consoles.Like monopolistic competition, oligopolies often sell products that are similar but not identical and not have much control over their prices. Like everyone loves iPhone but if Apple raise the price of a phone to $3,000 then many will start switching to an Android, but the price of an iPhone is pretty close to the price of a high-end Android.
So how do they compete?
The answer is non-price competition and as you might guess it's competing without changing the price this happens in a lot of Industries companies focus on things like style quality location or service the goal is to distinguish their product from their competitors like the
Let's say...Jeans, that one company sells might be virtually identical to everyone else's in terms of quality. But if you can convince consumers that their logo tag on the butt looks cool well than then you are a step ahead than others. If a company has better customer service or has more convenient locations the most recognizable are some form of non-price competition.
This topic is much more deep and we go on and on, if you want us to make more blogs on such topics please let us know in comment section below…
Hope this blog was informative and helped you in some kind. Feel free to give your suggestion by commenting in the comment section below. Be updated for more post by FOLLOWING/SUBSCRIBING us and following us on social media.Thank You for visiting Info Thirst.
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