Economics Essay

HND Micro Macro Economics
Assessment Outcome 1 essay
  1. Two characteristics of an oligopolistic market.
Two characteristics of an oligopolistic market are the companies within the market usually selling very similar products and the market is dominated by large firms usually only a few. For example supermarkets are in an oligopolistic market because they all sell the same items for roughly the same prices. Supermarkets in the UK are also dominated by the big four chains Tesco, asda, Morrisons and Sainsbury. Another big characteristic of an oligopolistic market is that the companies within the market can earn very large profits over a long period of time. Companies like asda and Tesco have made billions over the years and will continue to do in the future because they have so many customers continually buying their products.
Evidence of the mobile phone market being an oligopolistic market is the fact that it is dominated by a few large firms like O2, orange and vodaphone who are making very large annual profits and they all basically sell the same products.

HND Micro Macro Economics essay

Outcome 1
By
Andrew Hamilton

  2. Two characteristics of a Monopoly market structure
Another market structure is a monopoly market structure. Two characteristics of a monopoly market structure are that there is only one main seller of a single commodity and there are no close substitutes for the product.
A good example of a product in a monopoly market is Microsoft. For a very long time Microsoft was the only internet service provider and they owned internet explorer. This means that because they were the only providers for this that they could charge any price they wanted to the customers in this market. Because it was such a large market they maid billions from it, this is why Bill Gates the founder of Microsoft is the richest man in the world.
To summarise this market structure there is only one provider of a certain product and a high demand for this... [continues]

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