Economic Research of Sainsburys
To accomplish an oligopolistic market composition there are certain qualities which has to be achieved. Some firms would dominate the marketplace, each of these organizations has a significant market electricity and could closely stick to the behaviour of the other companies on the market. Unlike in a monopolistic market structure, these products produced by the firms in the oligopoly market do include substitutes. Firms will use low price competition methods help to make their products or services stand out from the other, these may include mass media advertising, loyalty cards, residence delivery, widened opening occasions (24hrs) internet shopping, special offers and superior customer satisfaction.
If a firm were to enhance their price above OP require could become very flexible, the oligopolistic may dread that a within price might not be followed by their very own competitors, therefore their bigger price may lose them a share of the industry If a organization was to lower their selling price lower than OPERATIVE demand may become incredibly inelastic, the danger on this occasions is that they may possibly increase product sales but if the rival not only complements their new selling price nevertheless that they might have a lower selling price undermining them, therefore losing product sales but also losing the oligopoly company a share of the market.
Monopoly is actually a market structure where there is one organization that has complete control over industry for a service or product because it is the only supplier. To become monopoly there are specific condition that have to be accomplished. You must always be the sole supplier of a good/service therefore substantial market electric power over price being set and amount of the merchandise being produced; there is no substitute for this item. Monopolies are generally in sectors that are very hard to break into; this can be for various reasons. Patents registered to products, large start up costs, Government Tariffs and Quotas and industrial sectors protected by law (Post Office) would all make this very difficult for the new organization to gain...