Lecture 22: Monopolistic Competition and Intro to Oligopoly (2 pages)

Previewing page 1 of actual document. View the full content.
View Full Document

Lecture 22: Monopolistic Competition and Intro to Oligopoly



Previewing page 1 of actual document.

View the full content.
View Full Document
View Full Document

Lecture 22: Monopolistic Competition and Intro to Oligopoly

1037 views

This lecture Clark addressed in more detail monopolistic competition, and also introduced the market structure of oligopoly.


Lecture number:
22
Pages:
2
Type:
Lecture Note
School:
The University of Oklahoma
Course:
Econ 1123 - Princ. of Econ-Micro
Edition:
1

Unformatted text preview:

ECON 1123 1st Edition Lecture 22 Outline From Previous Lecture Lecture 21 I Characteristics of Monopolistic Competition II Brands III Persuasive Advertising IV Comparison between monopolistic competitive firms and perfectly competitive firms Outline of Current Lecture 22 I Monopolistic Competition A Short Run Economic Profits B Long Run Zero Economic Profits C Monopolistic Versus Pure Competition II Oligopoly A Definition B Cartel C Price Leadership Dominant Firm Competitive Fringe Lecture 22 Notes I Monopolistic Competition A Short Run Economic Profits For monopolistic competition you still compare the price to the average total cost to find profitablitiy The major difference is the more elastic demand schedule B Long Run Zero Economic Profits ATC will be tangent to the demand schedule In the long run Pmc ATC will give zero economic profits D Monopolistic Versus Pure Competition Pure competition price marginal cost economic efficiency Monopolistic competition price marginal cost economic inefficiency Pure competition in the long run production is at minimum average total costs In monopolistic competition production is at a point higher than minimum ATC These notes represent a detailed interpretation of the professor s lecture GradeBuddy is best used as a supplement to your own notes not as a substitute Higher average costs are incurred by producing a variety of differentiated products II Oligopoly A Definition Oligopoly A market with a few firms dominating the industry 1 Each firm must consider its competitors reactions when making its own decisions mutual interdependence 2 Significant barriers to entry government regulations like patents and licenses start up costs capital barrier economies of scale product differentiation access to suppliers distribution networks B Cartel Cartel like OPEC organization of petroleum exporting countries Cartel An agreement between firms or countries in an industry to formally collude on price and output then agree on distribution of



View Full Document

Access the best Study Guides, Lecture Notes and Practice Exams

Loading Unlocking...
Login

Join to view Lecture 22: Monopolistic Competition and Intro to Oligopoly and access 3M+ class-specific study document.

or
We will never post anything without your permission.
Don't have an account?
Sign Up

Join to view Lecture 22: Monopolistic Competition and Intro to Oligopoly and access 3M+ class-specific study document.

or

By creating an account you agree to our Privacy Policy and Terms Of Use

Already a member?