Monopolistic Competition in the Retail Industry
Defining the Market
The retail industry is comprised of thousands of different brands and companies. However each is defined by its quality of make and materials used. Abercrombie & Fitch, Timberland, and Guess are all well-known and respected brand names. However if prices were to exceed what people are willing to pay, then the consumers would alter their preferences and buy from another brand. Therefore we are dealing with a monopolistic competition.
Monopolistic competition is often defined as: a common form of industry structure characterized by a large number of firms, none of which can influence market price by virtue of size alone; some degree of market power is achieved by firms producing differentiated products. New firms can enter and established firms can exit with ease )
I. ?common form of the industry structure characterized by a large number of firms none of which can influence market price by virtue of size alone ? New firms can enter and established firms can exit with ease.?
Every year hundreds of new designers emerge into the retail industry. No matter what one?s style of clothing, there are dozens of other brands to choose from should one company?s price go beyond the household?s expectation of price. Each company is on a careful balance of price and cannot exceed the other company?s prices beyond what the consumer sees as reasonable. Moreover, firms can enter and exit easily because there are no tariffs and resources are plentiful. This is the competitive side of monopolistic competition.
II. ??some degree of market power is achieved by firms producing differentiated products??
However the retail firm is also monopolistic because of the added aspect that each company does have some degree of market power through their differentiation of products. One way firms differentiate themselves is through the consumer and the way they fashion their products. The consumer determines the success/failure of a company. A major problem firms face is how to accommodate to the changing preferences of the consumer. Guess was at one point similar to Levi?s, a brand of jeans limited to the department store. However in 2002, Guess signed on Marciano, a prominent high-end European designer, and sales have boomed since. Now, Guess is a well-known, popular brand among teenagers and ...
... middle of paper ...
...l be most receptive. Timberlands are successful in areas with cold, long winters like Ohio but would make minimal profit in area such as Florida.
Bibiliography
1. Case, Karl E. & Ray C. Fair. Principles of Microeconomics. New Jersey: Pearson Education, Inc., 2004.
2. ?Guess-Marciano,? 2004.
< http://www.marciano.com>
3. ?Glossary of Economic Terms? Federal Reserve Bank of San Francisco.
Understanding the Terms
Symbol = a code comprised of letters used as a unique identification of the stock
52 week High = the highest price reached during the last 52 weeks
52 week Low = the lowest price reached during the last 52 weeks
Dividend = taxable payment declared by a company?s board of directors & given to its shareholders out of the company?s current/retained earnings
Dividend Yield = yield a company pays its shareholders in the form of dividends; calculated by the amount of dividends paid per share over the course of the year divided by the stock price
P/E Ratio = (aka the price earnings ratio) most common measure of how pricey the stock is; equivalent to a stock?s market capitalization divided by its post tax earnings over a year?s period
middle of paper ... ... 113-117. 429-477. Gans, King and Mankiw 1999, Oligopoly' in Principles of Microeconomics, eds. Janette Whelan, Harcourt Brace & Company, Australia, pp.
This organization belongs to the oligopoly market structure. The oligopoly market structure involves a few sellers of a standardized or differentiated product, a homogenous oligopoly or a differentiated oligopoly (McConnell, 2004, p. 467). In an oligopolistic market each firm is affected by the decisions of the other firms in the industry in determining their price and output (McConnell, 2005, P.413). Another factor of an oligopolistic market is the conditions of entry. In an oligopoly, there are significant barriers to entry into the market. These barriers exist because in these industries, three or four firms may have sufficient sales to achieve economies of scale, making the smaller firms would not be able to survive against the larger companies that control the industry (McConnell, 2005, p.
In general merchandise retailing, Wal-Mart’s primary competitors are Target and Kmart. Retail superstores such as Circuit City and Bed, Bath, and Beyond, also provide retail competition. A survey found that the majority of respondents favored Wal-Mart over stores like Target and Kmart. Respondents claimed Wal-Mart offered lower prices, better variety and selection, and good quality. The needs of consumers is an important economic feature in all competitive environments. What attributes (price, variety, quality, etc.) prompt buyers to choose one retailer over another is very important in the competitive landscape.
Lovegrove, W. (1991) ‘Spatial frequency processing in dyslexic and normal readers’, in Stein, J.F. (ed.) Vision and Visual Dyslexia, London, Macmillan.
At first, Gilgamesh is a controlling and arrogant king, who thinks only of himself. He constantly works the men, building enormous walls surrounding the entire kingdom and countless temples. He “leaves no virgin to her lover” (62) no matter who she was, young or old. Additionally, he takes away the children so that “no son is left with his father” (62). Gilgamesh treats his people with such disrespect that they begin to complain about him to the gods. When Anu, the god of firmament, hears the people’s lamentations he goes to Aruru, the goddess of creation saying, “You made him, O Aruru, now create his equal” (62). The people and the gods felt that if Gilgamesh had someone equal to him in strength and power that they would compete together leaving the city of Uruk in peace. Therefore, in reply to the grievances of the gods and people Enkidu is sent down to earth.
There are many industries. Economist group them into four market models: 1) pure competition which involves a very large number of firms producing a standardized producer. New firms may enter very easily. 2) Pure monopoly is a market structure in which one firm is the sole seller a product or service like a local electric company. Entry of additional firms is blocked so that one firm is the industry. 3)Monopolistic competition is characterized by a relatively large number of sellers producing differentiated product. 4)Oligopoly involves only a few sellers; this “fewness” means that each firm is affected by the decisions of rival and must take these decisions into account in determining its own price and output. Pure competition assumes that firms and resources are mobile among different kinds of industries.
Introduction Dividends are the distribution of profits in the company. It depends on the type of dividend policy that is being made by companies. Dividend policy will affect the behaviours and attitudes of investors towards the company. Many economists and financial experts have constructed different theories to interpret the effects of a dividend policy on the society. But these theories are contestable since they are not tested in the real world.
There are four major market structures; perfect competition, monopolistic competition, oligopoly, and monopoly. Perfect competition is the market structure in which there are many sellers and buyers, firms produce a homogeneous product, and there is free entry into and exit out of the industry (Amacher & Pate, 2013). A perfect competition is characterized by the fact that homogeneous products are being created. With this being the case consumers have no tendency to buy one product over the other, because they are all the same. Perfect competitions are also set up so that there is companies are free to enter and leave a market as they choose. They are allowed to do with without any type of restriction, from either the government or the other companies. This structure is purely theoretical, and represents and extreme end of the market structure. The opposite end of the market structure from perfect competition is monopoly.
I can't remember the day my hair and I parted ways. We used to get along when we were young! Displayed in the ponytail fountain on top of my head, she was quite cooperative....
Petro, G. (2012, November 5). The future of fashion retailing --- the H&M approach (part 3 of 3). Retrieved from http://www.forbes.com/sites/gregpetro/2012/11/05/the-future-of-fashion-retailing-the-hm-approach-part-3-of-3/
In the previous study, Milevsky, Schlechter, Klem, and Kehl (2008) states that adolescence with either both parents are neglectful parenting style or one of the parent is neglectful parenting style score lower on self-esteem than adolescence without neglectful parenting style parent. In daily life, parents that let their children involve in making family decision lead their children to higher self-esteem level than parents that only want their children obey without giving any reason. Parents with authoritative parenting style are more flexible, openness to discussion and also willing to compromise toward their children. In a sample of 230 college student, Buri, Louiselle, Misukanis and Mueller (1988) found that
The second market structure is a monopolistic competition. The conditions of this market are similar as for perfect competition except the product is not homogenous it is differentiated; thus having control over its price. (Nellis and Parker, 1997). There are many firms and freedom of entry into the industry, firms are price makers and are faced with a downward sloping demand curve as well as profit maximizers. Examples include; restaurant businesses, hotels and pubs, specialist retailing (builders) and consumer services (Sloman, 2013).
Markets have four different structures which need different "attitudes" from the suppliers in order to enter, compete and effectively gain share in the market. When competing, one can be in a perfect competition, in a monopolistic competition an oligopoly or a monopoly [1]. Each of these structures ensures different situations in regards to competition from a perfect competition where firms compete all being equal in terms of threats and opportunities, in terms of the homogeneity of the products sold, ensuring that every competitor has the same chance to get a share of the market, to the other end of the scale where we have monopolies whereby one company alone dominates the whole market not allowing any other company to enter the market selling the product (or service) at its price.
Life is not merely something that we experience outwardly. It can be an awakening to imagination, emotion, and true virtue. As we experience feelings in the way Puddleglum lived, believing in something so profound and so realistic that no apathy or emptiness could ever dissuade him, we can learn to live a life worth continuing. Keeping our eyes on that which is not fleeting or passing away, we can learn to feel more and with purpose. As 1 John 2:17 declares, “And the world is passing away with all its desires, but the person who does the will of God remains
Oligopoly is a market structure where there are a few firms producing all or most of the market supply of a particular good or service and whose decisions about the industry's output can affect competitors. Examples of oligopolistic structures are supermarket, banking industry and pharmaceutical industry.