Two extreme market forms are monopoly characterised by the existence of a single seller and perfect competition characterised by a large number of sellers.
Many people are aware of what a monopoly is and the federal government has even taken steps to make monopolies in the United States illegal. However many are unaware of the many oligopolies operating in the US economic system today. We will write a custom essay sample on Monopoly vs.
These two situations as defined are similar in the fact that one or few corporations or businesses control the industry and its prices. The consumer is the target in both situations; you see where its one or few the consumer is forced to pay the prices set by these controlling corporations.
Monopolies and Oligopolies differ in a few ways. In a monopoly you have one cooperation that controls the price and supply of the said product or service, allowing for no competition.
Or in other words allowing them to charge consumers whatever price that want and even the opportunity to raise prices at any time for no reason thus in a way holding the consumer hostage.
In oligopolies there is more than one major player and this allows for some competition in the industry. It also gives consumers more than one option. If one company lowers the price a consumer may choose to switch companies. The most evident difference as stated above is that monopolies are illegal and mandated by the US government where oligopolies are a common market situation in the United States.
A great example of an oligopoly is the US Automobile industry. There are a variety of manufactures to choose from, however most Americans will agree the major players are Ford, General Motors, Honda and Toyota. These major players in the industry control the actions of each other and their competitors.
InGM offered customers employee pricing. This affected the whole industry, Ford, Toyota and other manufacturers were forced to do the same thing or offer something better in order to match the prices of GM to generate profits in the industry.
This is a common marketing strategy for automobile manufacturers, the use these tactics to anticipate the next move of their competitors. It also can cause smaller manufacturing companies to go out of business as they can no longer compete with these large companies.
However they do still exist, for example utility companies usually operate in specific areas where they do not have competition.
Consumers are forced to use them do to the region, city or district in which they live. They do not have choices and are required to pay whatever prices their utility company charges for the service. Another good example would be DirecTV, while there are other cable and satellite companies to choose from they offer a service no other company can; NFL Package.Whether a monopoly or an oligopoly the consumer has little to no say in the market situation and one or few businesses are allowed to dictate prices and supply of their respective products and services.
Monopoly vs. Oligopoly. 10 October Whether a monopoly or an oligopoly the consumer has little to no say in the market situation and one or few businesses are allowed to dictate prices and supply of their respective products and services.
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urgent 3h delivery. Monopoly, oligopoly, perfect competition, and monopolistic competition Essay Sample. The Australian market is a diverse economic ocean – it has different species of marine life (industries), different swells (market structure) and even ‘hot’ and ‘cold’ spots (public companies).
Monopoly and Oligopoly essay - Economics. Buy best quality custom written Monopoly and Oligopoly essay. Essay on Oligopoly and Monopoly Oligopoly An oligopoly is an intermediate market structure between the extremes of perfect competition and monopoly.
Oligopoly firms might compete (noncooperative oligopoly) or cooperate (cooperative oligopoly) in the marketplace. Monopoly and Oligopoly Essay The Main characteristics of an oligopoly are that the supply of a product or products is concentrated in the hands of a few large suppliers, there could be thousands of small suppliers but the market is mainly dominated by around 4 or 5 large firms.