Answer to Question #323408 in Macroeconomics for nshongore

Question

There are various market structures, under which each firm in an economy follows into, these market structures range from perfect competition to monopoly. 

a) How do characteristics of a monopoly differ from those of a perfect competition? 

b) .Your company operates in an oligopoly market. You have been told that non price competition strategies can help you increase your sales in the short run. Would you propose and explain any 3 non price competition campaigns that you would employ for this call?

Answer 1

a) A monopoly is characterized by a single seller in the market, branded products, high barriers to market entry and great pricing power. This differs from perfect competition, which is characterized by many sellers in the market, homogenous products, price taking and ease of market entry and exit.

b)Nonprice competition campaigns for oligopolies include:

Advertising of products or information

Service level such as subsidized delivery

Physical characteristics and other unique selling points