Reference no: EM132917914

A small restaurant chain (ten restaurants across five cities in a region) serving an ethnic menu (the type doesn't matter for this question) at a somewhat higher price with better quality, presentation and service than their competitors. The restaurant chain features "specials" offering different ones twice every week. (A "special" is like putting something "on sale" for a lower price for a short period). They hope this will persuade patrons (customers) to come to their restaurants for repeat visits, even though their prices in general are somewhat higher than those of their competitors. In the SCP context, just from what you read here, are they in (moving from lower to higher) the perfect competition, monopolistic, oligopoly or monopoly level and why (that is, how is your answer manifested (demonstrated, shown) by what is contained here? (answer in "a" below)

a. Which level and how is it shown (how can we tell)? Don't have to answer, I know its monopolistic

b. How can it move up to the next level? (oligopoly)

c. If it does not do "b" as you have it, thus remaining as it is, what could cause it to move back, to the level below? (perfect competition)