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 authoritative in our chance(a) lives and one classical thing we should consider studying, is the principles and roles of the nutriment grocerys, to be specific, the matched market places, 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 plower and buyer is a terms taker. (Principle of Economics pg.290 Mankiw) In a matched each transmiter and buyer accepts a predetermined price for the particular good being presented. The derive 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 locate and cognise they had increase the fluff prices by 20 cents, that particular st ation would hold in a large drop in sales of gas scarce you could go to a several(predicate) store where the gas whitethorn be cheaper. Two major characteristics in a competitive market are that in that location are mevery buyers and sellers in the market and the goods offered by the miscellaneous 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 add up to the amount of product you have sold. This way th at the market price is the same regardless o! f how much 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 unwavering 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 ships company has a monopoly, such as an galvanizing company they may raise their price for electricity but that does not opine you can go someplace...If you want to get a lavish essay, order it on our website: OrderCustomPaper.com

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