StudentShare solutions
Triangle menu

Market Structures Analyses - Essay Example

Not dowloaded yet

Extract of sample
Market Structures Analyses

The producers can't afford the labor without selling their crops. Their debts build up and their crops are left to ruin.
In a perfectly competitive market, there are many buyers and sellers and therefore no individual player can influence the market as a whole. Hence the firms become "price takers" by accepting the price determined by the intersection of the demand and supply curves. Therefore the firm's demand curve is perfectly elastic and price equals marginal revenue as shown in the graph.
Individual firms cannot increase prices due to the competitiveness of the market and the highly elastic demand curve. Hence there are normal profits to be gained for the producers. The products are homogenous and therefore the buyers are indifferent as to which firm they purchase from. There are no barriers to entry or exit; hence firms can enter and leave the industry with no cost liabilities. In such a competitive environment, there is maximum efficiency and competent allocation of resources with minimum wastage.
A trace of monopolistic competition is found in chapter 13 of the book where the Joads stop to fill gas at a gas station. The owner of the station is characterized as a crushed man, one who is afraid of the change that the world around him has embraced. He talks about how he sees cars move west all day and the only ones that stop in his station are the ones that have no money. They exchange beds, baby buggies, pots, pans, dolls, even shoes for the gas. The rich cars, however, stop only at company stations in town. He refers to these stations as the yellow painted ones in town. We also notice how the owner tries to imitate the company stations with the yellow paint but fails because of the loose hangings and the old cracks in his beaten old station.
Monopolistic competition or imperfect competition is relatively similar to that of perfect competition except that the products are not homogenous. There are large number of players in the market, but due to differentiation of products, each individual firm has a small market share and a limited ability to influence prices. In this market, the barriers to entry are very small and there is sufficient product knowledge among the consumers.

Product differentiation, which is the characteristic of monopolistic competition, creates a difference between products by deeming them similar but not identical. The product of one producer can be differentiated from that of another. A competitive producer uses non price competitive methods such as advertising, packaging, brand names, design to differentiate his products. There are substitutes in the market but they are not perfect substitutes.

Firms have some control over prices, but the demand curve remains downward sloping and elastic. The producer aims at maximizing his profits by charging as much as he can over and above the output where his marginal revenue and costs
equal, without compromising his sales. In the long run, however, new entries will shift the demand curve and the cost curve, thereby squeezing the profits.



Oligopoly
Chapter 19 narrates the ...Show more

Summary

Chapter 25 of The Grapes of Wrath speaks about the Californian land owners and their crops during the spring. There are cherries, oranges, peaches, pears and grapes everywhere and the earth smells of ripe and fresh fruits. The owners stand by and calculate their profits for that year…
Author : aufderharvincen
Market Structures Analyses essay example
Read Text Preview
Save Your Time for More Important Things
Let us write or edit the essay on your topic
"Market Structures Analyses"
with a personal 20% discount.
Grab the best paper

Related Essays

Differentiating Between Market Structures
The paper will analyze the market forces of the company and the associated competitive strategies. The market structure where the company operates will also be examined. Market Analysis The company has been successful in catering the customers. The businesses specialize in hiring chefs and train them to serve the purpose.
4 pages (1000 words) Essay
Market Structures in Sony Corporation
A Sony Corporation is a leading manufacturer of electric electronic gadgets all over the world such as music, online business, motion pictures, television, and computer entertainment. The organization has gained recognition throughout the world following its high awareness of products to the customers.
4 pages (1000 words) Essay
Differentiaitng between market structures
These market structures range from the perfect competition to monopoly, in between these two extremes are the monopolistic competition and oligopoly. Their differences may be summarized through the number of firms present in the industry, barriers to entry, their market power and the type of products they are selling (Schiller, 2006).
6 pages (1500 words) Essay
Differiating Between Market Structures
al, 2011). Therefore, market structure affects the market outcomes by influencing opportunities, motivations and decisions of vast industries participating in the market. The aim of market structure analysis is to isolate the effects in an attempt to predict and explain the market outcome.
4 pages (1000 words) Essay
Market structures
Therefore the market structures of an economy can be categorized under the following types. Perfectly Competitive Market In a perfectly competitive market there are a large number of buyers and sellers and therefore the equilibrium price and quantity in the market would be determined by the combined forced of demand and supply.
11 pages (2750 words) Essay
US primary market structures
As such market structure refers to the state of market or an industry with respect to competition (Market Structure 1).Market structure is important in determining the degree of competition in an industry thereby enabling us to know how this rivalry affects a customer.
3 pages (750 words) Essay
Market Structures
The businesses that these monopolies are into also have significant barriers of entry making it difficult for other competitors to offer a similar service. As can be understood from above, in a monopolistic organization, the company is king, while the powers of the consumer are limited.
8 pages (2000 words) Essay
Market Structures
Because it has no competitor, the whole market depends on the monopolist’s production, and this dependence gives the monopolist power to raise the prices even at the same quality of output, or
3 pages (750 words) Essay
Market Structures
In spite of being close substitutes, the products can be differentiated and advertising and branding plays a major role in this type of market. A large number of sellers exist in the market. The market structure is
3 pages (750 words) Essay
Market Structures
In economics, market structure is the feature of a particular market in the economy. The features of a market can be organizational, competitive, or any other characteristics that define the commodity market. The yardstick that economists use in defining market structures is the pricing models and the nature of competition in a particular market.
2 pages (500 words) Essay
Get a custom paper written
by a pro under your requirements!
Win a special DISCOUNT!
Put in your e-mail and click the button with your lucky finger
Your email
YOUR PRIZE:
Apply my DISCOUNT
Comments (0)
Rate this paper:
Thank you! Your comment has been sent and will be posted after moderation