Xeco/212 Principles of Economics

Maximizing Profits in Market Structures Paper XXXXX XECO/212 Principles of economic science January 29, 2012 Instructor: George Tsilis A foodstuff places structure is dogged by a number of different characteristics. These characteristics include market size and value, prophecy for growth, the number of product suppliers and their market part and the purchasing bearing of individual consumers. Competition in a market allows the value of a product to change in response to move supply and demand. This competition forces the markets to have remarkable routes to maximize profits. For apiece product there similarly subsist several alternating(a)s for a consumer, allowing a buyer to find a cheaper or more readily available product to dirty word ones palms. In a power all-encompassingy war-ridden market, the power lies with the consumer as each dollar he spends touch ons the structure of the market. When no substitutions pull round, the manufacturing bus iness controls the price and availability of a product and the markets structure is heavily wedge by the producer. Several forms of these markets exist and this paper will talk over three of them; competitive markets, monopolies, and oligopolies. A competitive or blameless competition market contains a crowing number of producers planning a like or similar product to a market of legion(predicate) buyers.

There exist many substitutes of a product full-grown power to the consumer to choose which supplier to purchase from. The supplier whitethorn choose to raise the price, but because of the large number of alternative products the consumer may choose to purchase elsewhere. set is determined strictly by supply and deman! d, giving leverage to consumers and removing the ability of producers to affect the market structure. Profits are maximized in this market when streamlined production allows for the product to be interchange for a profit. A supplier should be able to extend production for as long as the bare(a) tax revenue exceeds the marginal cost of production. If supply exceeds demand,...If you want to get a full essay, order it on our website: OrderEssay.net

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