Market Structure Simulation
Market Structure Simulation
Armani Nelson
Professor William Johnson
ECO/365
April 24, 2012.
In the simulation Differentiating between Market Structures I learned about the four market structures, which are perfect competition, monopoly, monopolistic competition, and oligopoly. I learned about cost and revenue curves within the market structures and how these structures work within an organization. The simulation also dealt with prisoner’s dilemma, price war and duopoly. The prisoner dilemma is known as a two-person game and demonstrates the difficulties of cooperate tactics when faced with different scenarios and situations. The simulation was informative and provided examples of the four market structure. The simulation presented the CEO of the transportation company with different scenarios in regard to the freight transportation industry. Within the competitive market the transportation company was able to maintain ground and run a successful company despite their competition. In perfect competition this includes sellers and buyers with no barriers for the entry of new firms and each seller happens to be a price taker: with maximize profits and complete information (University of Phoenix, 2012). Marginal revenues and marginal cost were also discussed. It showed how firms maximize their profits when marginal revenues are equal to the marginal cost. “A monopolist’s marginal revenue is always below its price” (Colander, 2012). The prices of these organizations are similar if not identical within all organizations. The simulation discussed the organizations chemical division the organization and how being a oligopoly is considered a duopoly which consist of more than one firm. Great example would be supermarkets like Publix and Windixe. The simulation also discussed the monopolistic market. In comparison to Wal-Mart being monopolistic the organization in the simulation was monopolistic as well. Profits are maximized by the MR=MC (University of Phoenix,
Armani Nelson
Professor William Johnson
ECO/365
April 24, 2012.
In the simulation Differentiating between Market Structures I learned about the four market structures, which are perfect competition, monopoly, monopolistic competition, and oligopoly. I learned about cost and revenue curves within the market structures and how these structures work within an organization. The simulation also dealt with prisoner’s dilemma, price war and duopoly. The prisoner dilemma is known as a two-person game and demonstrates the difficulties of cooperate tactics when faced with different scenarios and situations. The simulation was informative and provided examples of the four market structure. The simulation presented the CEO of the transportation company with different scenarios in regard to the freight transportation industry. Within the competitive market the transportation company was able to maintain ground and run a successful company despite their competition. In perfect competition this includes sellers and buyers with no barriers for the entry of new firms and each seller happens to be a price taker: with maximize profits and complete information (University of Phoenix, 2012). Marginal revenues and marginal cost were also discussed. It showed how firms maximize their profits when marginal revenues are equal to the marginal cost. “A monopolist’s marginal revenue is always below its price” (Colander, 2012). The prices of these organizations are similar if not identical within all organizations. The simulation discussed the organizations chemical division the organization and how being a oligopoly is considered a duopoly which consist of more than one firm. Great example would be supermarkets like Publix and Windixe. The simulation also discussed the monopolistic market. In comparison to Wal-Mart being monopolistic the organization in the simulation was monopolistic as well. Profits are maximized by the MR=MC (University of Phoenix,
References: Colander, D. (2010). Economics. New York, NY: McGraw-Hill/Irwin Publishers. University of Phoenix. (2012). Differentiating between Market Structures. Retrieved April, 24,2012 from University of Phoenix, rEsource, Simulation, ECO365- Principles of Microeconomics Web site.