Advertisements
Advertisements
Question
A car company ‘W’ hired an international cricket player for its endorsement in India, while two other car companies’ ‘Y’ and ‘R’ hired two famous Bollywood film stars for this purpose. Explain the features of the competitive market indicated above.
Solution
It is a sales promotion measure in view of intense competition and interdependence of firms under oligopoly. Every firm under this market form enjoys a large market share due to small number of firms. Every firm’s action affects its rival firms. So, while taking decisions, a firm has to take into account the impact on and reaction of its rivals. This phenomenon has been reflected in the example.
APPEARS IN
RELATED QUESTIONS
Explain ‘large number of buyers and sellers' features of a perfectly competitive market.
What is a price taker firm?
Explain the implications of the following : Perfect knowledge in perfect competition.
Explain Perfect knowledge about the markets feature of perfect competition.
Under which market form is a firm a price taker?
Why can a firm not earn abnormal profits under perfect competition in the long run? Explain.
Explain the implication of ‘freedom of entry and exit to the firms’ under perfect competition.
In which market form can a firm not influence the price of the product?
What are the characteristics of a perfectly competitive market?
Answer the following question.
Is a firm under perfect competition a price taker, or a price maker? Justify your answer.
Identify the market form and explain the corresponding feature, as given in the following statement:
"The commodity in this market has attributes which are identical for sellers and buyers."
Choose the correct answer from given options
A firm is not a price maker under
Under Perfect Competition, a firm will enjoy normal profit in the long run even if it enjoys supernormal profit in the short run. Explain.
How is Total Revenue under perfect competition different from Total Revenue under imperfect competition? Give two points to show the difference.
A perfectly competitive firm always enjoys normal profit in the long run, irrespective of the situation it faces in the short run. Discuss the statement in brief.
