In: Economics
With organizational examples discuss competitive and monopoly industries. Page 221 (or close by) in the textbook gives a nice grid to assist you with your response. 150 words.
1.Competitive Industries
i) In Competitive market there is competitors because of that its effect on product price market and sales because of that company needs have to set price as per competitors price,
For Example -
As above graph there is two Famous companies of Show making, Here Sale of Nike is more compare to Addidas, of Why cause Rate of Nike shoe is less compare to Addidas and quality sale,
Here simply if Nike Increase sale of their shoes then, it impact on sale and Adidas sale is increase compare to Nike. And Adidas decrease price of shoes then also Adidas sale increase,
Simply in Competitive market Low cost strategy affect on others competitors sales.
Also Differentiation is important part in Comparative market, product should be different and innovate from competitive. Here compare to MacDonald’s and dominos then they always concern trade on Product differentiation, try to make new food products which will like by customers for increase sale.
So in Competitive industries Product differentiation is very important.
ii) Another example of Competitive industries
Samsung and Apple always competitive each other, they always manufacture different and innovate smartphone to competitive and increase sale, always make strategy of Low Cost, always innovate new techniques,
2. Monopoly Industries -
1) In Monopoly business one of the important Advantage/benefit is they can set price of product and services as per their decision, In Monopoly business there is no competitor or substitute because of that Monopoly business can take advantage of these things and set their price as per market condition or company ,
For Example –
Definitely Western Australia transport system that is Transperth, is also Monopoly of Western Australia and there is no substitute available to compared with it, because of that definitely Transperth is make profit which is Economic positive profit,
Example of Transperth Monopoly
(Above Rate for 10Km Journey of Transperth WA)
As Above Diagram,
But If consider Transperth WA Monopoly business, if they arise Price each year of Train tickets such as in 2017 Single Train ticket was $10 for 10km journey that time consumer buy tickets around 20%, after that in 2018 Transperth increase price of tickets for same journey around $12 therefore consumer % increased to 30%, after that in 2019 it increase ticket price $14 therefore consumer buy tickets the % increased by 40%, and in 2020 price is $15 for same journey there fore % of tickets buyers increases upto 50%, so this is Transperth monopoly business advantages, cause of un-availability of Competitor, Transperth earn more revenue even they increase Price of Train Tickets
then also Passenger going to buy tickets cause in WA there is no Substitute for Transperth, cause of that Transperth always make more profit compare to Competitive market or business,
ii) Another Example of Monopoly industries is
Microsoft Windows, and Google Search Engine,
As you everyone know Microsoft Windows, and Google Search both are well known brand company but it is also true both are Monopoly industries, in world No one competitors are for Microsoft Windows, and Google Search, mostly computer have Microsoft operating system, and Price of software can decided by them, and it did not affect on sale cause of no one competitors available,
Same about Google Search engine, yes there are Yahoo browsers and others browsers available but in world as per survey 91% People using Google search engine, that why it is also included in monopoly industries. And not affected from others Low cost, Product differentiation, value, market strength strategy.