Market Structure Simulation

Topics: Economics, Monopoly, Microeconomics Pages: 2 (520 words) Published: January 22, 2012
Market Structure Simulation Quasar Computers

When industries are selling similar products this makes up market structure. I will be discussing economic profit that Quasar computer is able to make. The market structure is made of the following pure monopoly, pure competition, monopolistic competition, and oligopoly. In the simulation I learn about pricing and non pricing strategies and understanding the diverse market structure. Quasar put out a new first all-optical notebook that is called Neutron. Quasar had to come with strategy regarding price and gain profit while having the only notebook on the market and monopolizing. To give a basic overview we Quasar set the price at $2,550 per notebook to create a place and so that marginal cost will equal to marginal revenue. In 2004 Quasar Computers had to review the advertising. The recommendation was $500 million. My price was $2,450, total cost 13.29, total revenue 15.1 and total profit was 1.82. Due to the new lunch, David thought it would be a good idea to upgrade production. Jane thinks we should improve on the areas that we had major losses. Quasar Computers would need to sell more than over $500 million to make a profit and the Neutron would have to be priced higher. In 2006 competition arrises and we have to lower our prices, work on brand building to make sure we can keep our gain from Orin Technolgies since the company gain 50% of the market in notebooks. Orin Technologies is now in the same industry as Quasar and we are no longer monopolizing but Oligopoly. I think Quasar was a bit caught off guard. They had to think fast before competition became an issue. Quasar had to make decision quick if they should invest more funds into the marketing if they wanted to sell notebooks and reach out to a larger base of consumers or work on research and development.

If Quasar wanted to success they had to stop and think about what infficiences they had and not expect to sell the same amount of...
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