They both target the market for maximum profit thus they have different approaches to make it successful. A brief outlook of both firms will help in understanding the topic thoroughly.
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Producers are only interested of taking their cost and resources are easily mobilized. Thus it makes a perfect combination.
The most interesting part is that Perfect Competitive market has growth levels to improve their quality and revise their prices which make them vulnerable and devoted towards their product. This is observed and practice because a lot of firms comes in and introduce their new may be advanced product to customers and if you fail to offer something equivalent then customers simply turns their backs. These are some positive gestures which you receive from the market to improve further or bring something new to attract the customers. All conditions are to be fulfilled to make it a Perfect Competitive Market.
Monopolistic Market: It is a place where only one party holds the system and moulds it accordingly. There are several other problems that occur for consumers if the market is monopolistic like supply constraints are faced often and prices are fixed according to their will, mostly high and excessive barriers are being laid for new comers which is a hindrance in getting new offers and sufferers are only customers as they can’t help buying the product available. This type of markets are usually said to be in telecommunication or media industry sectors as they lay strong foundation by investing a huge amount which cannot be easily challenged. But they are bad for themselves in a way that they do not face competitor, which does not make them realize to go for innovations or advancements. The best example here is American Software Company known as Microsoft which ruled the software sector for decades because of its Windows Operating System. They were later challenged by Apple with extra ordinary efforts for which Apple waited for years and today it is in dominance. Remember efficiency is not the only factor affecting monopoly. Monopolies can still achieve a good profit ratio then Competitive markets in the long run.
This term can
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to earn profits in the long run. Thus, the future viability of the organization is an integral part of the organizations’ basic objectives. However, this is not as simple as it seems to be. The main threat to this objective is the risk. RISK MANAGEMENT: In organizational context, risk is anything which endangers the future viability of the organization.
It takes a number to years for a company to create a name in the industry and a specific brand that would catch a particular following in the market. However, despite the quality products and services, these companies may not be able to make enormous profits in the long run.
However, there are opposing opinions to create unrest. According to George Watson, “Monopoly favors the rich (on the whole) just as competition (on the whole) favors the poor.” (Fitzgerald, 1988) On the one hand, the economist voice about perfect competition and on the other, monopoly is talked upon.
Modeled after RyanAir, another successful and profitable European carrier, Air Asia is finding considerable customer satisfaction and brand loyalty for perceptions of Air Asia quality and price. Air Asia also operates in a market where there is considerable price sensitivity, which limits the scope of its ability to alter service to include more service options without losing customers drawn to its current low price model.
Explain graphically and verbally what happens to the market in the short run and in the new long-run equilibrium if factor prices and demand are assumed to remain the same as before. Hint: You have to use two parallel diagrams, one for an individual (representative) firm and one for the industry.
Nevertheless, these changes haven’t affected the benefits that anybody can experience with the practice of swimming. To have a clearer idea of those changes it is helpful to study the history of swimming
Other factors that differentiate perfectly competitive markets from other market structures are easy entry and exit into and out of the industry (Welch & Welch, 2009). Both consumers and producers have perfect information availability regarding quality and prices of the products and there are no transaction costs involved in buying and selling of products.
This paper dwells upon profit as the main aim of any firm. To support this idea the writer states that a firm which does not function with the aim to maximize profits runs the risk of going out of business. This is because the law of natural selection applies even to the field of business and a firm which does not actively try to maximize its profits may be forced out of business by its competitors.
et structure of a firm in a given industry influences the way the company conducts business and how pricing strategies and how to obtain the quantity supplied. However, pricing strategy and quantity supplied all affects profit maximization for the firm (Besanko, et al. 2011 p.,
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