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Trava [24]
3 years ago
8

Market structures For each of the following scenarios, determine which market model best describes the scenario. Then identify t

he number of firms, the type of product, and the ease with which new firms can enter the market under this market structure.Scenario Number of Firms Type of Product Entry Market ModelMany small shops sell different styles of sweaters. Some stores sell higher-quality and more expensive sweaters then other stores. Hundreds of high school students who require tutoring in algebra choose among dozens of tutoring companies offering similar services. Four Internet providers offer similar services to almost everyone in the city. Any new company would have to engage in a price war with the existing companies. Only one pharmaceutical company has a government patent to sell an experimental drug.options: 1. few/many/one 2. differtiated/standard/unique/anything 3. impossible/challenging/easy 4. oligopoly/monopoly/price-taker/price-searcher
Business
1 answer:
pantera1 [17]3 years ago
4 0

Answer:

Please refer explanation

Explanation:

A. Many small shops sell different styles of sweaters. Some stores sell higher-quality and more expensive sweaters then other stores.

1. many

2. differentiated

3. easy

4. price-searcher

Monopolistic competition is whereby there are many firms selling similar products and services but are not perfect substitutes. They may be different in quality, design or style. Barriers to entry are low and any one firm’s decision does not necessary affect all others. These firms tend to have limited price setting powers and they make use of heavy adverting and brand differentiation.

B. Hundreds of high school students who require tutoring in algebra choose among dozens of tutoring companies offering similar services.

1. many

2. standard

3. easy

4. price-taker

Perfect competition is a market structure where there are many firms selling homogenous or commodity products, such as a fruit or vegetable vendor. They do not have the ability to influence the price and they take the price that they receive. There is free flow of information between sellers and buyers regarding the goods sold as well as the prices of goods and services sold. Firms can easily enter and exit the market.

C. Four Internet providers offer similar services to almost everyone in the city. Any new company would have to engage in a price war with the existing companies.

1. few

2. standard

3. challenging

4. oligopoly

Oligopoly is an imperfect market structure with a small number of firms who are impacted by each other’s actions. Oligopolies may collide either explicitly or tacitly in order to restrict output or fix prices and achieve above normal market returns. Government policies and regulations are placed to encourage or discourage oligopolistic behavior and ensure that consumers are not exploited.

D. Only one pharmaceutical company has a government patent to sell an experimental drug.

1. one

2. unique

3. impossible

4. monopoly

A monopoly refers to a single company dominating the market in an industry. It has a proportionately large market share. This can be due to an absence of proper restraints. They have control of the price in the market for that product. There are very large batters to entry and exit, they exploit economies of scale and are able to make abnormal profits in the industry.

You might be interested in
Prepare income statements based on variable costing for each of the 2 years. 2.Prepare income statements based on absorption cos
enot [183]

Answer:

The question is incomplete, it is missing the accounts and numbers, so I looked for a similar question:

<em>The Rehe Comany sells its razors at $3 per unit. The company uses a first-in, first-out actual costing system. A fixed manufacturing cost rate is computed at the end of each year by dividing the actual fixed manufacturing costs by the actual production units. The following data are related to its first two years of operation: </em>

<em>                    2011 2012 </em>

<em>Sales 1000 units  1200 units </em>

<em>Costs: </em>

<em>Variable manufacturing  700 500</em>

<em>Fixed manufacturing  700 700</em>

<em>Variable operating (marketing) 1000 1200 </em>

<em>Fixed operating (marketing)  400 400</em>

<em />

                                                           2011                  2012

Sales                                               1000 units         1200 units

Production                                          1400                  1000  

Costs:  

Variable manufacturing                      $700               $500

per unit $0.50

Fixed manufacturing                           $700               $700

Variable operating (marketing)         $1000             $1200

Fixed operating (marketing)               $400               $400

cogs under absorption costing 2011 = ($1,400 / 1,400) x 1,000 = $1,000

cogs under absorption costing 2012 = $400 + ($1,200 / 1,000) x 800 = $1,360

1.                                    INCOME STATEMENTS

                                      VARIABLE COSTING

                                                             2011                    2012

Total sales revenue:                        $3,000                $3,600            

Opening inventory:                               ($0)                 ($200)

Variable manufacturing:                   ($700)                 ($500)

<u>Ending inventory:                               $200                   $100 </u>

Gross contribution margin:             $2,500               $3,000

<u>Variable operating:                         ($1,000)              ($1,200)</u>  <u> </u>

Contribution margin:                        $1,500                $1,800  

Fixed manufacturing:                         ($700)                ($700)

<u>Fixed operating:                                ($400)                ($400) </u>

Net operating income:                       $400                  $700

2.                                   INCOME STATEMENTS

                                   ABSORPTION COSTING

                                                             2011                    2012

Total sales revenue:                        $3,000                $3,600            

<u>COGS:                                             ($1,000)                ($1,360) </u>

Gross margin:                                  $2,000                $2,240

<u>Operating costs:                             ($1,400)               ($1,600) </u>

Net operating income:                       $600                   $640

3. Under variable costing, closing inventory = 400 units x $0.50 (variable production costs per unit) = $200.

Under absorption costing, closing inventory = 400 units x $1 (production cost per unit) = $400

Since closing inventory is $200 higher under absorption costing, then net operating income during 2011 increases by $200.

4. a) Variable costing is more likely to result in inventory buildups. Since variable costing determines the value of closing inventory only using variable manufacturing costs, their value is much lower. E.g. in this case the value of closing inventory 2011 under variable costing is $200, while under absorption costing it is $400. This means that less costs are transferred from one year to another.

b) Cost of goods sold must include all production costs (both variable and fixed). This way COGS costs cannot be over estimated during one year and under estimated the next.

<em> </em>

<em />

3 0
3 years ago
An approach that recognizes that, with every interaction, customers learn something about a company that will affect their desir
Allushta [10]

Answer: Customer experience management.

Explanation:

Customer experience management is the ways in which a company provides it's consumers the best customised experience during their period of patronizing the business: the customer experience management makes the best use of physical and digital contact with consumers to give them a wonderful experience and maintain customer patronage.

7 0
3 years ago
Suppose that real domestic output in an economy is 20 units, the quantity of inputs is 10, and the price of each input is $4. An
weqwewe [10]

Answer:

A. supply curve shifts to the left

Explanation:

An increase in the prices of inputs from $4 to $6 shows economic problems that include a reduction in capital stock, labor, and an increased unemployment rate. This can also give room for inflation.

This increase shows that due to shortage in labor supply, it now costs more to produce a product.

Due to all the above mentioned reasons, the supply curve of both long run and short run supply curves shifts left.

Cheers.

7 0
3 years ago
Bayer AG was accused as a participant in an international price-fixing scheme that drove up the costs of rubber chemicals used t
irinina [24]
They need to be out into jail
4 0
2 years ago
The Boxwood Company sells blankets for $ 32.00 each. The following was taken from the inventory records during May. The company
nika2105 [10]

Answer:

(C) $94.00

Explanation:

The computation of the cost of goods sold for the sale of May 20 is shown below:

= Remaining units × cost price + remaining units × cost price

= 4 units × $15 + 2 units × $17

= $60 + $34

= $94

The 4 units come from May 1 and May 10 i.e 9 units - 5 units = 4 units

And on May 20, the 6 units were sold out of which 4 units were sold at price of $15 and rest 2 units were sold at a price of $17

8 0
3 years ago
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