Term
|
Definition
A market structure in which only a few sellers offer the same or similar products
only a few sellers, can have large impact on the other seller's profit |
|
|
Term
|
Definition
| Study of how people behave in stragetic situations. |
|
|
Term
|
Definition
| Firms agree on how much to produce and at what price for each member. |
|
|
Term
|
Definition
| Firms acting in a collusion. |
|
|
Term
|
Definition
| Firms that choose the better, self-interest based strategy based on other firms decisions. |
|
|
Term
|
Definition
--produce more than a monopoly, less than a competitive market
--price lower than monopoly, more than a competitive market |
|
|
Term
|
Definition
| Because price is above mariginal cost, selling 1 more will raise profits. |
|
|
Term
|
Definition
| Raising production will increase total amount sold, which will lower the price and lower the profit. |
|
|
Term
|
Definition
Why cooperation is difficult, even if it's mutually beneficial.
People strive for best individual situation rather than best for the whole, which is probably even better than the best individual situation. |
|
|
Term
|
Definition
| Best strategy for one regardless of other's decisions |
|
|
Term
|
Definition
| Keep oligopolies from making markets less competitive. |
|
|
Term
|
Definition
| Producers require a minimum price for retailers to offer to customers |
|
|
Term
| Cons for Resale Price Maintenance |
|
Definition
| Seen as a violation of antitrust laws because it prevents retailers from competiting on price. |
|
|
Term
| Economist view of Resale Price Maintenance |
|
Definition
--Producers want retailers to compete becase that means mroe product is sold.
--Higher price means more knowledgable sales force. W/o, customers would learn about product from "better" retailer and then buy from discount retailer. Discount is a free rider. |
|
|
Term
|
Definition
| Slashing prices to drive out competition |
|
|
Term
| Why preditory pricing is rarely profitable |
|
Definition
| Preditor ends up suffering more than prey |
|
|
Term
|
Definition
| Bundling products, only selling them together |
|
|
Term
| Government skepticism of tying products |
|
Definition
| It expands market power of producer |
|
|
Term
| Price discrimination in tying products |
|
Definition
| 2 firms individually value products differently, but the same when bundled together. Bundle matches firms' willingness to pay. |
|
|
