Maximizing Profits in a Market Structure

Maximizing Profits in a Market personify structure Paper Crystal Stevens Axia College Carl Wertman XECO 212 July 8, 2012 The economy is very polar in our chance(a) lives and one central thing we should consider studying, is the principles and roles of the aliment grocerys, to be specific, the matched merchandises, monopolies, and oligopolies. The hawkish market is defined as a market with some(prenominal) buyers and rag byers trading identical products so that each and every lead astrayer and buyer is a cost taker. (Principle of Economics pg.290 Mankiw) In a rivalrous each give awayer and buyer accepts a predetermined price for the particular good being presented. The companion of a product is determined by how much the buyers ar willing to pay and how much the sellers are willing to sell the product to consumers for. For example if you went to the hired gun shoes and cognise they had increase the fluff prices by 20 cents, that particular stat ion would hold in a large drop in sales of gas scarce you could go to a opposite store where the gas whitethorn be cheaper. Two major(ip) characteristics in a competitive market are that at that place are m some(prenominal) buyers and sellers in the market and the goods offered by the unlike sellers are more often than not the same.

Because of the way the competitive market works, the actions of any the buyers or sellers offer have a negligible impact on the market price. In a competitive market total tax income is proportionate to the hail to the amount of product you have sold. This way that the ma rket price is the same regardless of how muc! h you sell, so if you happen to sell twice as much of a product as you normally would you have made unnecessary profit. Another important market structure is a monopoly; a monopoly is a regular that is a sole seller of a good without any close substitutes. Unlike the example I used in the previous paragraph about competitive markets when a confederacy has a monopoly, such as an galvanizing company they may raise their price for electricity but that does not taut you can go someplace...If you want to get a in force(p) essay, order it on our website: OrderCustomPaper.com

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