Monopolistic competition.
Four conditions of monopolistic competition.
Nonprice competition.
Prices, outputs, and profits.
100
companies that compete in an open market to sell products that are similar but not identical.
What is monopolistic competition?
100
Many firms: ~Firms can easily begin selling goods and earning money after a small investment, because of this many firms can and tend to spring up fairly quickly to compete in the market.
What is the 1st condition within the four of monopolistic competition?
100
style, location, service, and advertising.
What are the 4 ways firms attract customers?
100
Firms are not able to raise prices as high as they would like......
What is high competition?
200
jeans, it can be separated by brand, style, color, and sizes.
What is the product used as an example of monopolistic competition?
200
Few artificial barriers to entry: ~Firms in a monopolistically competitive market do not go through high barriers of entry. Patent protection does not protect you from competitors And since a M.C market contains so many competing firms producers can't work together to eliminate new competitors.
What is the 2nd condition of monopolistic competition?
200
House pricing around DP is more compared to that of houses in mclaren circle. This is an example of 1 of 4 ways that firms try to attract consumers.
What is location?
200
consumers can easily buy substitutes if not faced with a monopoly.
Why do monopolistically competitive firms face more elastic demand curves than true monopolists?
300
Monopolistically competitive firms sell goods that are similar enough to be..........
What is a substitute?
300
3rd condition: ~Each firm's goods are a little different from everyone else's, and some people are actually willing to pay more for the difference. Firms have a bit of freedom over their prices when it comes to lowering or raising them, but they don't have control over what the exact price will be for a product.
What is LiTtLe ChAnGe OvEr PrIcE?
300
increased pricing due to design expertise and expense to continue prospering with that particular and innovative artist's contributions.
What is popularity of a designer?
300
output and price are negatively related.
What is the law of demand stating in relation to output?
400
Presented in the everyday life of firms.
what is monopolistic competition?
400
4th: ~Firms have some control over their selling price because they can differentiate from other products in the market. ~Differentiation allows for an M.C seller to profit from the differences of his or her product compared to those of the competitor's.
What is Differentiated products?
400
To point out differences between their product and others in the market.
What is the role that advertising plays in monopolistically competitive firms?
400
the answer is 2!
What is the amount of market trends that take away substantial profit?
500
~Many firms in the market. ~A few firms dominate the market.
What is the difference between monopolistic competition an oligopoly.
500
The rules that define a monopolistically competitive market are very similar to the rules of this relatively close form of competitiveness.
What is perfect competition?
500
People usually prefer ball point pens over regular pens because of the sharper tip and neater distribution of ink that the pen puts out while you are writing, but the ball point pens cost about $2 more, people still go out of their way to buy it.
what is style(physical characteristics)?
500
They find a substitute.
What do consumers continue to do? buy a good regardless of price increase, or search for an alternative?
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