Desember 01, 2017
MONOPOLY AND OLIGOPOLY MARKET DEFINITIONS WITH THEIR CONFIDENCE
Understanding Monopoly and oligopoly Markets
Monopoly market is a form of market that there are only sellers (producers) and can control the market while the oligopoly market is a form of market where the supply of goods can be controlled by several companies.
As a price maker, a monopolist can increase or decrease prices by determining the quantity of goods to be produced, the less the quantity of goods to be produced the more expensive the price of the goods, even vice versa.
Monopoly market feature traits:
1. one manufacturer who controls the manufacturer
2. substitution goods
3. the manufacturer determines the price
4. entrepreneurs enter the market
the government can prevent losses caused by the monopolist:
1. Prevent monopoly by law
2. The government must establish a company
3. to open imports for goods produced by monopolists
4. Invisible hand intervenes government in determining the price
Features of oligopoly markets:
1. Seller (manufacturer) who controls the market
2. goods to be sold in the form of homogeneous goods
3. There is a strong entry barrier for the company.
Negative impact of oligopoly for the economy:
1. profits for the largest producers in the long run
2. Exploitation of consumers to company employees
3. Government policy in overcoming oligopoly
4. Government creates competition market entry
5. Implemented anti-work law for producers
Understanding Monopoly and oligopoly Markets
Monopoly market is a form of market that there are only sellers (producers) and can control the market while the oligopoly market is a form of market where the supply of goods can be controlled by several companies.
As a price maker, a monopolist can increase or decrease prices by determining the quantity of goods to be produced, the less the quantity of goods to be produced the more expensive the price of the goods, even vice versa.
Monopoly market feature traits:
1. one manufacturer who controls the manufacturer
2. substitution goods
3. the manufacturer determines the price
4. entrepreneurs enter the market
the government can prevent losses caused by the monopolist:
1. Prevent monopoly by law
2. The government must establish a company
3. to open imports for goods produced by monopolists
4. Invisible hand intervenes government in determining the price
Features of oligopoly markets:
1. Seller (manufacturer) who controls the market
2. goods to be sold in the form of homogeneous goods
3. There is a strong entry barrier for the company.
Negative impact of oligopoly for the economy:
1. profits for the largest producers in the long run
2. Exploitation of consumers to company employees
3. Government policy in overcoming oligopoly
4. Government creates competition market entry
5. Implemented anti-work law for producers
