Market structure is a microeconomics term that encompasses the interconnected attributes of a market. The variables examined when considering market structure include characteristics of buyers and sellers, competition, product differentiation, and ease of moving into and from the market. Factors such as the number and strength of buyers and sellers, along with any collusion that may develop among them, are very influential on market structure, as evident in this discussion. An analysis of the competition will consider the occurrence and degree of product differentiation that is occurring. Finally, two important attributes of market structure are the ease of entry and exit from the existing market.
Traditionally, four fundamental market structure types are recognized: 1) Perfect competition, in which many buyers and sellers engage without being able to control prices; 2) Oligopoly, in which a number of large sellers have established some control over prices; 3) Monopoly, in which a single seller maintains near absolute control over supply and, therefore, over prices; and 4) Monopsony, in which a single buy exercises considerable control over demand and, as a result, over prices.
Assessing Market Structure Effectiveness
The strongest competitive forces are the drivers of profitability for a market; hence these competitive forces are key to an effective analysis and to the formulation of market strategy. It is critical to recognize that the most relevant competitive forces are not always salient, which means that conducting an assessment of market structure effectiveness for the operations of a particular company is a complex endeavor.
The most likely market structure in with this low-calorie food company operates is perfect competition at the niche level and oligopoly for large food manufacturing companies that have acquired other brands and businesses. It is helpful to consider that new low-calorie foods may be introduced to the market as niche products, but robust launches that result in a strong consumer following typically develop into entire product lines.
Two leading competitors in the low-calorie microwavable food industry are Lean Cuisine and Healthy Choice. Lean Cuisine has a 20.7% of the healthy eating and contaminated food supplies. Moreover, the influence of social media and the digital flow of information continue to trend high with respect to lifestyle-referenced consumer behavior.
Production and Cost Functions of Low-Calorie Microwaveable Foods
The challenge to the low-calorie, microwaveable food manufacturing companies is to determine how to choose the constellation of inputs that minimize the cost of producing the food products. This cost-minimization challenge has different facets depending on whether the period is for short-run or…
Microeconomics: Differentiating Between Market Structures in an Organization Microeconomics Electronics Industry The electronics industry has become one of the largest and fastest growing industries which generate billions of dollars every year. The major products of this industry include personal computers, laptops, mobile phones, televisions, digital cameras, music players, telephones, speakers, recording media, and all types of accessories for these products. The operations, performance, and profitability of the participants of electronics industry is affected
Market Structure and Managerial Decision Making The objective of this paper is to discuss the concept game theory in the competitive market environment where there are two or more firms competing against one another. The paper cites the examples of Nash equilibrium, prisoner dilemma, and dominant strategy. Moreover, the paper discusses the theory of perfect competition, monopoly, monopolistic market and theory of oligopoly. (Bhat, and Rau, 2008). Game Theory The game theory is
Microeconomics Industry description The modern day economic climate is extremely dynamic and challenging, revealing a context in which the economic agents are presented with both opportunities as well as challenges. One specific means in which they choose to respond to the challenges and seize the opportunities is represented by them joining forces through mergers and acquisitions. A particular merger of specific interest in 2011 is represented by the merger between Irving Oil
Market Efficient Respect Set Information Impossible Makes Abnormal Profits Market Efficient In his work, Fama argued that given the massive use of resources by the brokerage firm to conduct studies on trends in the industry, the effects of changes in interest rates on corporate balance sheets and expectations of managers and/or political analysts of the companies should be able to systematically beat a generic portfolio with the same risk characteristics. Since, according to
2007, potato chip industry Northwest competitively structured long-run competitive equilibrium; firms earning a normal rate return competing a monopolistically competitive market structure. Potato industry The situation The competitive business environment of today forces economic agents across the globe to develop and implement a wide array of strategies by which to respond to the challenges of the various stakeholder categories, such as competitors, business partners, employees, customers, the governmental and non-governmental institutions and
Macroeconomic and Microeconomics Differences With Examples: Microeconomics and Macroeconomics are two separate branches of the same field, economics. Together they help us better understand the market dynamics and economic forces that shape them. Macroeconomics deals with the aggregate performance of the economy, the industries and discusses such serious issues as inflation, unemployment and growth. Microeconomics on the study hand is solely concerned with the smaller picture. It is mainly concerned with