Question

Please answer 2 of the following please? Provide references

• Investigate the DeBeers Diamond cartel. How did they manage to establish and maintain that monopoly for so many year has that had on prices and availability of stones? Why is the cartel starting to experiencing cracks for the first time?
• Investigate the farming industry. This is the last perfectly competitive market in America. So then, why are some farmers becoming millionaires while others are driving a school bus in the winter to make ends meet? How have economies of scale changed the market and do you see this industry maintaining its perfectly competitive status?
• What are the legal barriers that create monopolies in this country? Have these barriers promoted the general welfare of society or are they only benefiting a few? How have patent trolls changed the landscape of legal barriers?
• Investigate a clear example of price discrimination. How have they been able to identify who is willing to pay more? How have they enforced it and prevented reselling? If super star acts like the Eagles and Beyonce knew ticket prices for their shows would skyrocket, why would they let scalpers reap the great profits rather than taking advantage of price discrimination and force some to pay much higher prices?

Answer 1

Monoptoly is a market situation in which there is only one seller of a product with barriers to entry of others.The product has no close substitutes.the cross elasticity of demand with every other product is very low.this means that no other firms produce a similar product.thus the monopoly firm is itself an industry and the monopolist faces the industry demand curve.the demand curve for his product is, therefore, relatively stable and slopes downward to right, given the tastes and incomes of his customers.it means that more of the product can be sold at a lower price than at a higher price.he is a price maker who can set the price to his maximum advantage.however ,it does not mean that he can set both price and output.he can do either of the two things his price is determined by his demand curve once he selects his output level or,once he sets price for his product,his output is determined by what consumer will take at that price.in any situation the ultimate aim of the monopolist is to have maximum profits.De beers group is an international corporation that specialises in diamond exploration diamond mining retailing.the farming industry is most of the market are perfectly competitive homogeneous product produce many sellers and buyers.given these assumptions the price output and profits under monopoly are determined by the forces of demand and supply. Investigation of price discrimination this concept given by pigoue and it means price discrimination monopolist sell some product at difference price from different buyers.Engles and Beyonce knew ticket price for their shows would skyrocket.