Question

Determine the type of market Amazon exists in (perfect competition, monopoly, monopolistic competition, or oligopoly) and determine how its “conduct” and “performance” might change if the company moved to each of the other 3 market types.

Answer 1

Amazon exists in an oligopoly market. In an oligopoly market, there are few sellers in the market , they either might sell homogenous or differentiated products.The entry barriers are high in a oligopoly market, In a monopolistic market, there are many sellers but they do not sell identical products.

Amazon , Ebay they exists in market, where they sell similar products, but are differentiated in terms of payment, customer service.

If it changed to a monopoly, then Amazon could charge any price that they wish to as it would enjoy market dominance.it would have delivered a much superior performance as it would have been the sole player in the market. If it was to operate in a perfect competition, then it would try and distinguish itself from competitors by providing better services to customers and providing after sale services as there would not be any market dominance for this firm.It's performance would have been heavily dependent weather it is successful in implementing a strategy in distinguishing itself from competitors,. Again in a monopolistic market, Amazon would try and distinguish the products it sells from its competitors