Question

There are four market structures - perfect competition, monopolistic competition, oligopoly, and monopoly.

1. Visit a retailer that you feel has the characteristics that are most close to the monopolistic competitive market structure.

1. Provide the name and location of the retailer (You can use online retailers. If you do, provide the website).

2. Describe its characteristics and how they differ from a perfect competition market structure.

2. Visit a retailer or business that you feel has the characteristics that are most close to an oligopoly market structure.

3. Provide the name and location of the retailer or business (If you use online organizations, provide the website).

4. Describe its characteristics and how these differ from the characteristics of a monopoly.

Answer 1

The retailer visited is Mc Donalds in Chicago. The main characteristic of the store is selling of differentiated product from its rivals and price of the product is different from the rival and existence of many firms in the fast food industry selling differentiated good. It is different from perfectly competitive market where homogeneous product is sold and price of the product is same.

Choosing tickets online from any airline is an example of oligopoly market structure. The prices of the firms in this industry are related and change in the price by one airlines also changes the price of another airlines. Thus, there exists strategic behavior of firms in this industry. It is different from monopoly because there are other airlines also and not a single airline and prices are low as compared to the case in monopoly.