All categories

3 years ago

Explain what happens when markets do not have enough competition.

Business

1 answer:

MatroZZZ [7]3 years ago

3 0

Answer:

The price will be higher and output lower in absence of competition.

Explanation:

When the market does not have enough competition, it provides a certain degree of market power to the existing producers. They are able to regulate prices and output.

It is likely that the suppliers will provide a fewer quantities of goods at a higher price, in order to maximize their profits. The socially optimal level of output will not be produced in the market.

The resources will not be efficiently allocated and deadweight loss will exist.

You might be interested in

Maria wants to purchase a new computer and go to the Caribbean for spring break. The computer is priced at $1,299, and the vacat

snow_tiger [21]

Answer:

Maria is writing a cheque of $1299 to purchase computer of $1200.

Here, the role which money plays is Medium of Exchange.

Further Explanation:

Money is anything which is commonly accepted in exchange of goods and services.

Money replaced the Barter system of exchange. Under Barter system, goods are exchanged for goods. This system is challenging as it requires huge effort and time of people to find someone who wants to purchase same thing which other has to offer.

Thus, money refined the system of exchange of goods and services in the economy.

The 4 key functions of money are:-

Medium of Exchange: Money is use to purchase goods and services.

People can keep money in hand or they can keep it in their savings or current account. To purchase something using money kept in savings or current account, buyer write cheque in the name of seller and bank is obliged to pay the seller by deducting amount from buyer's bank account.

Store of money: Money can be stored for the future.

Future is uncertain and money is the most liquid asset. Therefore, people store money for any future unforeseen future expanse and for future expanses like for higher education or for buying house etc.

People can store money at their homes or banks. In banks, they deposit money in fixed account which gives them interest.

Standard of deferred payments: Money can be use to settle future payments.

This function allows people to purchase any good or service in present period and pay in the future period. Thus, money is used for settlement of payments

Unit of Account: Money provides a common exchange value.

Every good and service can be expressed in money terms. Thus, money provides a common denominator for every good and service.

Learn More:

Medium of exchange.

brainly.com/question/9314080

Key words:

Money, Medium of exchange, Store of value, Unit of account, Standard of deferred payment

7 0

3 years ago

Read 2 more answers

The bargaining leverage of suppliers is greater when: Select one: a. Only a small number of suppliers exist and when it is diffi

Alchen [17]

Answer:

The correct answer is letter "A": Only a small number of suppliers exist and when it is difficult for industry members to switch to attractive substitutes.

Explanation:

Porter's Five Forces is a study scheme named after Harvard Professor Michael E. Porter (born 1947). It helps managers assess competition within the industry.

The first force analyzes the ease of marketplace entry for new participants.
The second factor measures the number and operation of a company's rivals.
The third element is the likelihood of a new good or service entering the market that will diminish the sales of existing goods.
The four-factor is that industry suppliers have negotiating power.
The fifth factor is the bargaining power of customers.

When the suppliers' bargaining power is higher, there are possibly a few of them in the market. The situation gets worse for manufacturers when switching from one supplier to another represents higher costs or when making the change to substitutes carries a high cost as well.

4 0

2 years ago

EXCESS CAPACITY Williamson Industries has $7 billion in sales and $1.944 billion in fixed assets. Currently, the company’s fixed

Lubov Fominskaja [6]

Answer:

a. Calculation of level of sales

Level of sales = Sales / Operating capacity

= 7,000,000,000/90%

= $7,777,777,777.78

b. Calculation of Target fixed Assets/Sales ratio

Fixed assets sales ratio = Fixed assets / Level of sales

= 1,944,000,000/7,777,777,777.78

= 0.249942857

= 0.25

c. Calculation of Increase in Fixed assets

Increase in fixed assets = Fixed assets sales ratio * (Increase in sales - Level of sales)

= 0.249942857 * (7,000,000,000*1+15% - 7,777,777,777.78)

= 0.249942857 * (8,050,000,000 - 7,777,777,777.78)

= 0.249942857 * 272,222,222.222

= $68,040,000.

8 0

3 years ago

Only answer if you're willing to assist. I have a project for Entrepreneurship, in which I need to make a powerpoint for a new k

goldfiish [28.3K]

Answer:

y e s

Explanation:

3 0

2 years ago

Read 2 more answers

An increasingly important advantage of the limited liability company is that its members?

victus00 [196]

An increasingly important advantage of the limited liability company is that its members are "able to deduct its operating losses against the member's regular revenue to the extent permitted by law".

<h3>What do you mean by limited liability company?</h3>

A Limited Liability Company (LLC) is refers to as a type of organization in which the members of that company is not liable for the losses occur in the business. The duties and responsibilities regarding losses are restricted here.

Adding to it, that means if the company fails to pay off its losses or debts to creditors, the personal assets of the members will not be added while paying the debt.

It is an enterprise structure that is the combination of the pass-thru taxation that is related to a partnership or sole proprietorship along with the rules of the company.

The main advantage of this type of company is that the members of that LLC can reduce their all operating losses like travelling, insurance, office supplies, payroll etc.

Moreover, the other benefits of Limited liability company include that this is more flexible than the other corporations and it provides different rights, classes and preferences to their members or managers.

Learn more about limited liability company, refer to the link:

brainly.com/question/3521418

#SPJ4

8 0

1 year ago