Oligopoly
Oligopoly is a a market structure with several _________ sellers.
A market structure with only two sellers is called a _______.
dominating
duopoly
MARKET
sellers
sellers
Features
Several
Oligopoly
______ dominant sellers.
Sellers are interdependent.
Oligopolists sell heterogeneous or homogeneous goods.
Entry is _________________.
________ information of the market.
restricted or difficult
Imperfect
Oligopolists are ____________. If one firm lowers the price, others will follow.
Firms can influence ______.
They have to search for a price which maximises their ______.
Behaviour of firms
prices
1. Oligopolists are price searchers
profits
Oligopoly
2. The possibility of price war
interdependent
price warsSo _________ may break out and some firms may go out of business.
In some oligopolistic markets, dominant sellers may act as ______ in initiating ____________.
Behaviour of firms
Oligopoly
3. Price leadership
leaders price changessmaller firmsThe ___________ will then follow.
price price
$
$
Behaviour of firms
Oligopoly
Firms often engage in __________________ .
4. Non-price competition
non-price competition
Example
Lucky draws organised by supermarkets.
Monopolistic competition is a market structure with the features of both ________________ and _________.
Monopolistic Competition
perfect competition monopoly
Features similar to perfect competition
Features similar to monopoly
A large number of _____ and ______
sellersbuyers
____ entry and exitFree
____________ goodsHeterogeneous
Perfect / Imperfect information of the market
As the firms sell differentiated products, they can influence the __________ of the good. They have to find the price which maximises their ______.
searchers
market priceprofits
Behaviour of firms
Monopolistic Competition
Monopolistic competitors are price ________.
_________ competitionNon-price
Quiz OneIdentify the market structure of the International Direct Dialing (IDD) services in Hong Kong.
The market is dominated by several major seller like:
Oligopoly
PCCW
Hutchison Global Crossing
New World TelephoneNew T&T
Quiz TwoSuppose the costs of providing IDD services are lower due to technological progress. If PCCW lowers its price, what will be the actions of other IDD service providers?
Other firms will _____ their prices when PCCW lowers its prices.
Since the market structure of IDD services is an oligopoly, the decisions made by firms will be _______________.interdependen
tlower
Quiz ThreeWhat is the market structure of newspaper stalls in Hong Kong? Explain.
It is _______________________ as the features of both ___________________ and _________ are present:
monopolistic competitionperfect competition monopol
y______ number of groceries in Hong Kong
entry into the market is _____ as only a small amount of capital is required
goods sold in different groceries are regarded as ______________ by consumers __________ information of the
market
largeeasy
heterogeneous
imperfect
End
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