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Competition in Markets

Competition in Markets . BTEC Business. Market Structures. Firms operate in markets. These are structured differently. We can look at three different types of market structure and find examples of each: monopoly duopoly oligopoly. Monopoly.

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Competition in Markets

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  1. Competition in Markets BTEC Business

  2. Market Structures • Firms operate in markets. • These are structured differently. • We can look at three different types of market structure and find examples of each: • monopoly • duopoly • oligopoly

  3. Monopoly • a market structure where there is a single seller of a unique product • no competition, as the firm = the market • potential for abuse of monopoly position • the market may be a natural monopoly • having competition amongst firms in this kind of market would be costly

  4. Example of Monopoly • there may be significant savings to be had from having one company running the market • Network Rail are responsible for the maintenance and upgrading of the UK rail network • is it safer to have one company in charge?

  5. Duopoly • two large producers or sellers • exactly two equally dominant firms seldom found • tend to compete or collude

  6. Example of Duopoly • global aircraft market • two dominant firms are Airbus and Boeing • how do they compete with each other?

  7. Oligopoly • markets dominated by a small number of large firms • the most common types of market • large firms are involved in selling either identical or very similar products • significant barriers to entry into the industry

  8. Example of Oligopoly • the personal and domestic care product markets • dominated by: • Unilever • Procter and Gamble • Colgate-Palmolive

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