Question

Q3. As a manager, would you prefer your business to be in a monopoly position or a perfectly competitive market? Why? Support your views with examples.

Answer 1

As a manager I would prefer for the company to have a monopoly status. The role of a manager for any form is essentially to extract maximum profits for the company and the stakeholders. This factor defines the position of manager , in order , the larger the profits a manager can extract, the higher his value is for the company.

Monopoly enable the company to hold a status in market where they can extract monopolistic profits. This is because the product sold has only one supplier but a lot of buyers. This position is perfect for profit generation and can mark the margins for a company to maximize.

Eg. If I want to sell a vaccine for Covid. 19, my company not only have a large market of consumers , but also my monopolistic status enables me to issue patent rights which gives my company additional royalty through the producers who further facilitates this vaccine's production. This kind of profits is only possible with restrictions in market ( through patent rights) which is absent in perfectly competitive market. Further being low supply but high demand , high prices are charged and maximum profit is gained.

This is why , asa manager , my role becomes a lot easier when it comes to profit extraction and survival in the company , hence I would prefer to be manager in monopoly position company.