Explain why oligopolistic firms are affected

Suppose also that the demands for products A and B are independent, so that the quantity sold of each of them is independent of the price of the other.

We just have to take their word for it. To import cores would also not be feasible as the freight costs and the exchange rate would affect the prices even more. With economies of scope, the joint cost is less than the sum of the individual costs, so that SC is greater than 0.

Kraft prices are currently lower than the price of Ndicore. However, as we outline below, except where the most technically demanding cores and tubes are concerned, imported paper is not in the geographical market.

For example, OPEC is a cartel seeking to control the price of oil. In a certain sense, as Robert H. Concentration ratios Interdependence of firms — companies will be affected by how other firms set price and output.

Many products are available for each individual symptom of nasal congestion, coughing, pain, or fever. There is a tendency for cartels to form because co-operation is likely to be highly rewarding. As a statement of general principle this caution is, of course, unimpeachable, even trite.

In media markets, for example, economies of scope between delivery infrastructures and content allow cable operators and asymmetric digital subscriber line ADSL providers to bundle Internet access, pay-TV and telephony, in what is known as a triple play.

Michał Kalecki

Want more resources for your classroom. While later he appeared to concede that it was technically possible to build most heavy cores without using Ndicore, he nevertheless continued to insist that it did not make commercial sense to do so. We should note that the parties themselves acknowledge that the structure of the upstream market lends itself it to collusion: The important question to be resolved by a competition evaluation of a vertical merger is usually whether the internalization of trade that is implied by a vertical agreement is pro-competitive or competition neutral or whether it is anti-competitive.

If one firm reduces its price and the other firmsin the market do not respond, the price cutter may substantially increase its sales.

Marketing and distribution costs may also be reduced when various products or services are combined. In dominant price leadership, the largest firm in the industry sets the price.


Saylor URL: allianceimmobilier39.com allianceimmobilier39.com 2 Preface Traditionally, intermediate-level international economics texts seem to fall into one of two categories.

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.

the behaviour of firms are affected. chapter 1. MARKETING: CONNECTING WITH CUSTOMERS. chapter OVERVIEW. Marketing is the process of planning and executing the conception, pricing, promotion, and distribution of ideas, goods, and services to create exchanges that satisfy individual and organizational objectives.

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Explain why oligopolistic firms are affected
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What are some current examples of oligopolies? | Investopedia