Question

I am doing a report for class, and I need to know this answer for the famous brand, GIVENCHY.

Would this business best be described as a perfect competitor, a monopolistic competitor, an oligopolist or a monopolist? Explain.

Answer 1

Let us understand the concepts of competition:

1. Perfect competition: Many sellers sell same good, easy entry for new entrants
2. Monopolistic competition: Many sellers sell differentiated goods, easy entry for new entrants
3. Oligopolistic competition: Few sellers sell differentiated goods, bit difficult for new entrants
4. Monopolistic competition: A single sellers sells unique good, difficult entry for new entrants

So, now the Brand GIVENCHY is a French luxury fashion and perfume house which sells the brand of haute couture clothing. The fashion market is open for new entrants and GIVENCHY sells differentiated goods from others hence it falls under Monopolistic competition