Question

2. Google could be regarded as the search engine monopolist of the world.

How would you assess the Elasticity of Demand of Google; according to you, a. is it high, b. is it low, c. is it medium or d. is it impossible to tell? Please explain.

ANSWER:

Answer 1

In my opinion the Elasticity of Demand of Google is medium. . Today the technology has become a crucial part of everyday lives of Americans’. On a digital marketplace as the world becomes more dependent the regulatory framework are vital built to ensure competition and fairness. However tech giants like Google, Amazon, Facebook and Apple have been the envy of corporate America due to their influence, size, and remarkable growth. The big tech companies today own too much power and influence over our economy, our democracy, and our society that it poses a threat to economic activities. In America, they’re primarily focused on causing the harm to consumers from a decline in competition as they monopolize the market. Tech giants are powerful, for sure because of medium demand elasticity. Google and Facebook Inc. control together nearly 60 percent of digital ad revenue in America and 64 percent of revenue from mobile ad, according to eMarketer. It causes the harmful effects from increased concentration such as weak growth in productivity, lower private investment, increasing inequality and declining dynamism in business, or the rate at which firms enter and exit markets; thus resulting to a medium elasticity of demand.