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Pure, Per Se and Natural Monopolies




Pure, Per Se and Natural Monopolies;1;Pure, Per Se and Natural Monopolies;Externalities (or spill-over);Taxes and Equity;Profit Maximization;Monopolistic Influences;Monopolies and Society;Price Discrimination;International Goods / Capital / Pricing;Government Budget Deficits;2;Comparison: Perfect Competition, Oligopoly and;Monopoly;Characteristic;PerfectCompetition;Numberoffirms;Many;Typeofproduct;Homogenous;Barrierstoentry;None;Supernormalshortrunprofit No;Supernormallongrunprofit No;Pricing;Pricetaker;Profitmaximization?;No;Nonpricecompetition;No;Economicefficiency;High;Innovativebehavior;Weak;Oligopoly;Few;Differentiated;High;No;No;Pricemaker;Notalways;No;Low;VeryStrong;Monopoly;One;Limited;High;No;No;Pricemaker;Usually,butnotalways;No;Low;Potentiallystrong;3;Unit 4;Externality or spill-over;Externality is an economic side-effect. It can be positive or negative.;Given the limited four natural economic resources with the unlimited human;wants and needs.;Operational Efficiency, Producing the good at the lowest possible;cost;Allocation Efficiency, Getting the product to the to all who can afford;at the lowest possible cost;4;Externality;Externality is an economic side-effect. It can be positive or negative.;Externalities are benefits (positive) or cost (negative) arising from an;economic activity that affect member of the society other than the people;engaged in the economic activity of producing or consuming a product or;service and are not reflected fully in PRICES of the good.;Examples;Bees and Pollination - Benefit;Medicine developments and underdeveloped countries-Benefit;Carbon dioxide and breathing - Cost;Acid Rain and forest -Cost;5;If the externality is beneficial, the market will provide too little, if it is a cost;the market will supply too much.;One potential solution;The most efficient solution to externalities is to require producers of goods;and services to include the cost these externalities in the economic activity;so will be a self-regulation.;REGULATION;For Negative externalities 1- ban 2- Tax or permit;For Positive externalities 1- subsidies;Negative and positive externalities can be addressed with government;regulation by taxes, permits and subsidies.;6;Off shore drilling have a negative externality which can be addressed with;government regulation such as taxes, permits. This will cause the following;The current BP Gulf of Mexico case.;It increase the cost of oil, electricity and reduce the supply and demand;more efficient production;Cleaner air and less pollution. Less usage of natural resources;Higher production cost if the company paid higher taxes or permit price.;The level that would keep the water clean (air etc) with the best pollution;level;How about the current financial crisis wealth, unemployment and the;stimulus money?;7;Import and Export;Import is when we purchase foreign goods and services.;Import examples are, Clothing, computers, and oil.;Export is when we sell our goods and services to foreigners.;Export examples are, Airplanes, heavy equipment and technology.;Most of the computer goods in the USA are imported from foreign courtiers. It is;bought at lower cost which is good for consumers. If we purchase made in America;it is good for the companies and level of unemployment but at a higher cost to the;consumer since our labor cost is higher than most of foreign countries.;8;Import and Export;What is the impact of import and export on;Pricing;Product differentiation;Employment;Competition and;Foreign exchange rate?;The assignment asked us to discuss the fashion industry.;Do you advocate buying made in America (domestic) or cheaper imported;fashions? Why or why not?;9;References;;;;10


Paper#31028 | Written in 18-Jul-2015

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