Markets with monopolistic competition

Assignment Help Business Economics

Reference no: EM133629746

Question

Up to now, we have talked about two types of market models: in the case of pure competition, there were a lot of firms all competing with each other; in the case of monopoly, one firm controlled the entire industry. This week, we are going to start thinking about those cases in between. We will allow firms to have a little bit of market power, but they still have to compete with other firms for customers.

To get an idea of a market with monopolistic competition, think about your decision about where to go out to eat for dinner. If you want to eat a hamburger, there are so many options to consider: Whataburger, McDonald's, Burger King, Five Guys, Fuddruckers, Smashburger, ...

Yes, it's true that these places all serve hamburgers, but they aren't all exactly the same. Some are flame-grilled, others are broiled, some offer different toppings, and others use higher-quality meats. Each company has to go out of their way to distinguish themselves in a crowded field.

In markets with monopolistic competition, you often find companies using creative ways to compete with each other and attract customers. In your response below, identify an industry that fits the description of a monopolistically competitive market and explain how firms in that industry differentiate their products by using one or more of the following techniques:

differences in physical or qualitative attributes

offering higher-quality service or amenities

more convenient locations

branding and image

Reference no: EM133629746

Questions Cloud

Government decide to set up bank of canada : Why did the government decide to set up the Bank of Canada in? 1934? Part 2 The government decided to set up the Bank of Canada in 1934 in order to Part 3 A.

Firms outside their local geographic region : However, ready-mix concrete is expensive to transport far because it's so heavy, so firms rarely compete with other firms outside their local geographic region

Prices and features of different computer models : Alex is saving money to buy a new computer. He creates a list where he tracks the prices and features of different computer models.

How is money functioning as medium of exchange : How is money functioning as a medium of exchange in this scenario, and are there any additional roles that money plays here?

Markets with monopolistic competition : In markets with monopolistic competition, you often find companies using creative ways to compete with each other and attract customers.

Consider long-run model for country producing two products : Consider a long-run model for a country producing two products (digital cameras and baskets) using two factors (capital and labor).

Common advance medical directives : According to the National Institute on Aging, four common advance medical directives are the Do not resuscitate order (DNR),

Cause of income inequality measure income inequality : Explain the cause of income inequality measure income inequality in an economy measure the quality of human capital in an economy.

Income and homeownership status staying constant : How are feelings towards paying taxes predicted to change when age increases by one year, with income and homeownership status staying constant?

User Account

All Pages