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PRODUCT DIFFERENTIATION
Product differentiation describes a situation in which there is a single product being manufactured by several suppliers, and the product of each supplier is basically the same. However, the suppliers try to create differences between their own product and the products of their rivals. It can be achieved through quality of service, after sales service, delivery dates, performance, reliability, branding, packaging, advertising or in some cases the differences may be more in the minds of the customers rather than real differences, but a successful advertising can create a belief that a service or product is better than others and thus enable one firm to sell more and at higher price than its competitors.
Factor combination in the long run In the long run it is possible to vary all factors of production. The firm is therefore restricted in its activities by the law of diminish
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explain williamsons model of managerial discretion?
Assume that input prices are constant at r = 1, w = 1, with technology which consists of 5 processes having the following properties: Process Inputs Capital (machine hours)
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Now, let's modify our model a bit. Let's add a fourth sector of spending so that Y = C + I + G + X n with X = X o and M = M = f (Y). Will this change, by itself, increase, decrea
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