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Pure competition refers to a market where there are large numbers of firms manufacturing a standardized or identical product where new firms can easily enter or exit. Though pure competition is comparatively rare, it is relevant to many industries and is prevalent for fish…
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Dq a.What are some examples of the four market structures?  the four market structures are: pure competition, pure monopoly, oligopoly and monopolistic competition. 
Pure competition refers to a market where there are large numbers of firms manufacturing a standardized or identical product where new firms can easily enter or exit. Though pure competition is comparatively rare, it is relevant to many industries and is prevalent for fish products, agricultural goods, basic metals, foreign exchange and stock shares.
Pure monopoly refers to a market structure where one firm is the only seller of a service or product where the entry of new firm is blocked. A local electric utility is an example of pure monopoly.
Monopolistic competition prevails in a market where there are large number of sellers manufacturing different products like furniture, clothing and books. In this setting there is a non price competition (or product differentiation) where the selling strategy is to distinguish their product from competing products or services on the basis of workmanship and design.
In an oligopoly setting there a few sellers that sell a differentiated or standardized product where the decision of competitors affects the sale of a firm. Therefore, firms consider the strategies of competitors to determine its output and price (McConnell 2005 p.177).
b. When should a start-up company expect profit? Is there a rule of thumb? 
A start up company can expect profit when the business is able to cover the expenses including the start up costs. The sale of products should earn enough revenue to meet ongoing expenses associated with the operation of the business. A start up business entrepreneur must realize that a product sales amounting to $10,000 will not cover a monthly overhead expenses of $10,000 because the sales returns has a gross profit of only around $4000. A business reaches break even point when the sales revenue is equal to all business costs. The break even point can be calculated by identifying the fixed costs and variable costs. Fixed costs are expenses which do not change with changes in the volume of sales. For example, administrative salaries and rent remains the same and are expenses that must be met regularly irrespective of the volume of sales. These are usually known as overhead costs. Variable costs fluctuate with changes in the volume of sales. Variable expenses like shipping, purchasing inventory and manufacturing costs of a product has to be met for a start up company to make profit.
The rule of thumb for a start up company is to reach the break even point to expect profit from the manufacture and sale of a product (Programs and services).
How does monopoly affect income distribution? 
Market structure and the distribution of income raise concerns about the formation of monopoly power where increased concentration of control moves into the hands of few monopolistic firms. Monopoly leads to decreased competition among firms and inefficient distribution of resources in the economy. Monopoly has an impact on the distribution of income. Research indicates that monopoly power reduces the income share of workers when compared to capitalists, and results in a decrease from two percent to nine percent in their income though historically it does not result in much costs to the society (Green 1990 p.26-27)
Monopoly and the distribution of income are associated by Kalecki to explain income distribution and the extent of accumulation in the economy which has an effect on the national income. The share of wage in an industrial capitalist economy and the cost of the basic raw materials from the monopolistic perspectives; the wage share is correlated to the cost which forms the variables in the production process. When the costs of other variables are static, the intensification of the extent of monopoly can lead to a wide margin between the price and cost. In other words the price of the product will rise with relative increase in the price of inputs. Since the aggregate incomes is a part of cost, such intensification of monopoly leads to a decrease in its share to the national income. Likewise, while other variables are static and the outlay on essential raw materials increase (the expense on non labor inputs), the income share will further decline as a fraction of the aggregate revenue. A change in any of the variable in the long or short run has an impact on the wages of the laborers (Mitra 2005 p.85).
Assume the following unit cost data are for a purely competitive firm 
Total Product 
Average
Fixed cost
Average
variable cost
Average
total cost
Price
0
4
$15
$37.50
$52.50
$32
5
12
37
49
38
6
10
37
47
41
7
8.57
37
47
46
8
7.5
40
46
56
a. At $32, will the firm produce in the short run? Why or why not? 
At, $32 the firm will shut down because the average variable cost is higher than the market price and cannot meet its variable expenses for running the business.
b. At $41, should the firm produce in the short run? Why or why not? 
When the price of the product is $41 the firm can produce in the short run because profit maximizing rule applies to purely competitive firm when marginal cost is equal or less than the market revenue (McConnell 2005 p.211).
c. At $56, should the firm produce in the short run? Why or why not?
The firm can produce in the short run when the market price is $56 because it is more than the average variable cost.
Reference
Green, M.B. 1990 Mergers and acquisitions: geographical and spatial perspectives London: Routledge
McConnell, C. R. 2005 Economics: Principles, Problems, Policies, 18e McGraw-Hill: New York Mitra, A. 2005 Terms of trade and class relations: an essay in political economy Hyderabad: Orient Blackswan, 2005
Programs and services to help you start, grow and succeed Available: http://www.sba.gov/smallbusinessplanner/start/financestartup/SERV_BREAKEVEN.html Retrieved on October 8, 2009 Read More
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