Market Structure / Supply & Demand Essay

Monopoly superstar person or company dominates provision of a particular crossway or service, in the absence of rivalrys. Consumers do not have a choice for provision of the product in question. A monopoly can nominate the shots on their product ( expenditure, availability etc.) as there is no utility(a) on offer to consumers. Monopolists tend to produce a limited itemise of product which atomic number 18 then sold at a mellow price (there is no need to compete). (Control of ask) The British Government seeks to restrict the demeanor of monopolies, so preventing unfair business behaviours.Oligopoly a small number of overriding firms or individuals compete to provide a product or service. contender is limited and as a result, very closely related. Everything a competitor does directly affects your business. E.g. If one company drops its prices all the otherwise businesses in the oligopoly are affected. Business decisions must always consider competitors fix / reaction. An oligopoly may agree to maintain artificially high prices technically wrong yet difficult to prove if nothing is in writing.Duopoly taken literally a duopoly means 2 firms control a trade. In world is usually means that 2 firms dominate a market by having the biggest share in it.Examples of duopolistic markets include Coca Cola and Pepsi as ascendent providers of soft drinks. There are umteen competitors in the field but Coke and Pepsi have such a huge share of the market that they dont usually see them as competition or influence on their business decisions.Perfect competition theoretical as are all the above definitions. Multiple providers offer a roomy choice to a broad spectrum of consumers. Consumers benefit from freedom of choice and businesses competing for theirimpost through competitive pricing and customer service. picture and penuryThe belief of tot up and demand is at the heart of a market economy. Prices, earnings, and the supply of seriouss is determin ed by the demand for it by consumers.Demand In frugal terms this is the amount of a product (or service) desired by consumers.Supply The quantity of a product or service a manufacturing business is allow foring to make available to consumers and the price at which they want to carry that product.Demand Curve a graph showing the correlation (or demand race) between the price of a product or service and how many consumers would desire it at different prices (if all other variables are unchanged). It is an blast to quantify preference. I.e. how much a consumer is willing to pay for something and at what read the cost outweighs the desire. Companies may use this demand relationship as a pricing guide and to determine how much of a product to manufacture, which in turn indicates the level of resources required. The simplest interpretation which can be drawn is that as prices essay, demand drops and vice versa.As we can see from the graphic above, at head word A the highest pri ce (P1) reflects the lowest quantity demanded (Q1). Conversely, at point C the number of units in demand (Q3) is much greater when the price (P3) is considerably lower.The downward slope of the curve reflects a negative relationship between price and quantity demanded. I.e. as one factor rises, the other drops and vice-versa.Variables other than price affecting demand.Demography the statistical make up of consumers (age range, income bracket, education, political persuasion etc.) all influence the demand for goods and services.Income a rise in income often correlates with a rise in demand for a good. The exception to this is if a good is considered inferior a rise in income may result in a switch to goods considered to be of higher(prenominal) quality. (e.g. plonk to fine wine)Substitutes Supply CurveThe basic premise from the suppliers point of view is that the higher the price a good can be sold for the more a business will be willing to supply.ReferencesBized.co.uk. 2014. Biz /ed Interactive Supply and Demand 1 Biz/ed. online Available at http//www.bized.co.uk/learn/political economy/markets/ apparatus/interactive/part1.htm Accessed 8 Apr 2014.Heakal, R. 2014. Demand Curve. image online Available at http//i.investopedia.com/inv/tutorials/site/economics/economics3.gif Accessed 8 Apr 2014.Heakal, R. 2014. Supply Curve. image online Available at http//i.investopedia.com/inv/tutorials/site/economics/economics4.gif Accessed 8 Apr 2014. -BBC News. 2014. Economy tracker Inflation. online Available at http//www.bbc.co.uk/news/10612209 Accessed 7 Apr 2014.HM Treasury, HM Revenue & Customs. 2013. Government incentives help 1,100 companies lift off. press release 7 November 2013.Staff, I. 2012. Economies Of Scale interpretation Investopedia. online Available at http//www.investopedia.com/terms/e/economiesofscale.asp Accessed 8 Apr 2014.http//www.etoro.com/blog/etoro-voice/19112013/8-things-investors-watching-google/?dl=30001303&utm_medium=Media&utm_source=46599 &utm_content=6579&utm_serial=google3.aspx&utm_campaign=google3.aspx&utm_term=http//paid.outbrain.com/network/redir