Joshua T. Hodgin
American Military School
Can you imagine having a company that sells a product that is significantly different from different products in the same market? This is called monopolistic competition. In my exploration I found a peice named " The Advantages of Monopolistic CompetitionвЂќ written by Catherine Capozzi that talks about different advantages of monopolistic competition. The areas covered by the writer were; costs, product quality and creation, and value discrimination. I will explain just how each of these issues relates to the fabric learned in my microeconomics program. Before I begin discussing the different topics, allow me to clarify a little about monopolistic competition. According to Economics Online, " the model of monopolistic competition details a common industry structure in which firms have many competitors, although each one sells a rather different productвЂќ (Economics Online). There are many samples of monopolistic businesses and a few that have been mentioned in the article were Microsoft, Sirius, XM A radio station and Jostens (a business that markets high school rings). If you think regarding each of these corporations you will understand the products that they sell are different from other folks in the same market, nonetheless they control industry to some degree. Any of these companies are capable of manipulate the amount paid of their product without having to stress about a fall in revenue. The economy is becoming somewhat dependent upon each of these businesses and will pay out the recommended price. Every thing is done within just reason of course , but in the conclusion you would probably pay $250 for the most recent version of Windows by Microsoft in order to keep up with current times. This really is a great lead in to the benefits of pricing. The writer the article My spouse and i read stated, " to be able to set larger prices can be described as primary benefit of monopolistic competitionвЂќ (Capozzi, 2012). She procedes explain just how prices are increased simply for...
References: Capozzi, C. (2012). Chron. Gathered December 23, 2012, in the Advantages of Monopolistic Competition: http://smallbusiness.chron.com/advantages-monopolistic-competition-20585.html
Economics Online. (n. deb. ). Recovered December twenty three, 2012, via Monopolistic Competition: http://economicsonline.co.uk/Business_economics/Monopolistic_competition.html