Economics †Short Answers Essay

coiffe 1 One of the problems that concern me adept now would be the continuous step-up of prices of oil colour products in the commercialise which greatly affected my budget. Moreover, the state hike of crude rock oil color prices causes our economy to toyion badly for the preceding(a) quarters which indirectly affects the prices of major commodities in the grocery store want sugar, coffee, rice etc based from what I grow read from the intelligence information papers and magazines. In this regard, oil price hike imposes negative externalities on our welf are consumers.But to some extent, oil price hike also bring benefits to our economy in a form of forcing our federal disposal to find government agencys of providing alternative sources of capability aside from crude oil like bio-fuel. If it not for the price hikes of petroleum products in the food merchandise for the past decades, authorities would make no effort to find separate sources of energy especially o ne that would serve as substitute for crude oil. later on a few more decades, prices of petroleum products leave behind start to nightfall as a consequence of emerging alternative sources of energy like bio-fuel as what I have said a while ago.Answer 2 One of the best manikins of monopolists that currently exist in the commercialise would be Microsoft Company. Microsoft Company serves to be the sole provider of Windows software beingness used by almost all of personal computers around the globe. In this regard, the absence of separate provider of Windows other than Microsoft makes the latter a monopolist catering for a large pool of buyers. Moreover, since Microsoft is the sole provider of Windows which we are all using nowadays, there is a great misfortune for Microsoft to explosive charge higher prices due to the absence of substitute goods for Windows.Furthermore, monopolists, because of its large market influence, female genitalia easily prevent new players to enter the industry of Software exertion giving them enough room to enjoy sole player in the market. Answer 3 Based from the negative effects that monopolists imposes not save to consumers but also to other market players, the federal government make necessary laws that would restrict the action of monopolists in the market creating enough way to protect the welfare of the consumers and other market players.One of the said laws could be the Anti-Trust Law. Anti-Trust Law is a bulk of laws that forbid unfair market competitions and anti- matched demeanour of monopolists through illegalizing some practices of the latter that believed to hurt either or twain businesses and consumers (U. S. Department of Justice, 1996). As for the case of labor monopolization of behemoth unions, I think we could also consider them as a source of voltage negative effects just like of Microsoft as well as the misallocation of economic resources.The main agreement here would be that, having a giant union m onopolizing laborers in the market, there is a t finishency that they will have a higher bargaining power on surreptitious firms of divers(a) industries, such(prenominal) as salary increase, which imposes negative effects on the subprogram of the businesses. At the end of the day, it is the consumers who will suffer from the actions of giant unions since the tendency of the orphic firms is to pass what ever the added costs they will incur from the said increase of bargaining power of labor unions.Answer 4 Another flake of market structure aside from monopoly would be oligopoly. Oligopoly is a type of market structure wherein there is a few sellers and many buyers in market. As compared to monopoly, there exist market competition in oligopoly which improves the musical note and sum of money of goods and services in the market and so with the consumer welfare. One possible example of oligopoly would be Wal-Mart. Wal-Mart is a retail stores and tagged as the Giant shop whic h leads the industry of retailing due to its large size relative to other retail stores in the industry.The only down turn here in oligopoly would be the possibility of collusion between those few sellers in the market in hostel for them to minimize competition and have control on the price level in the market. The said collusion of oligopolists is called cartel and this act in the market just like a monopoly. This is the reason why federal government is keeping an eye on oligopolists to prevent such scenario since cartel is no difference with monopoly. Answer 5 Yes, the local rally service market, which was dominated before by Bell, has a great possibility of reaching warring market due to the forces of competition.With the existence of competition, the local shout service industry members would have to compete to one another in order to attract more customers in terms such as higher service quality and lower price. Those improvements in the service quality and lower price of l ocal phone service would make the said industry competitive since consumer welfare will surely improve and at the end of the day, societal welfare will start to improve on side with the local phone service industry itself.Answer 6 One of the ways for us to determine if the product distinction of competitive firms us wasted or not would be to know if the consumers occupy dent loyalty which is the main bum of differentiating product from one another. harvest-home differentiation serves as the identity of any firm belonging to the competitive market and that identity will stand as the brand for the private firm. Now, if consumers in the market do not have the sense of brand loyalty, then, there is a big possibility that the product differentiation of private firms will be deemed unsuccessful in penetrating its target consumers.Answer 7 OPEC has been successful in controlling the production of oil since it has a bargaining power superimpose on the government of confused c ountries that supplies oil in the market. OPEC determines the market demand and confer existing in the institution market and either they increase or decrease the oil supply depending on the season, economic stability of their member countries and volume of supply of oil-producing countries to the organization, moreover, there are times that OPEC regulated the supply of oil for preventative reasons like during the times of war and during the times of potential shortage in the coming period.The only negative effect of OPECs intervention on our welfare, especially during the times when they cut the supply of oil in the instauration market, would be the high prices of petroleum products on our domestic market. Therefore, the reason why there is existing oil price hike in the market would be either OPEC cut the supply of oil in the world market which creates pressure for the prices of petroleum products to increase, or because of the economic and political derangement of oil-produc ing countries which creates threats for oil supply shortage in the world market.At the end of the day, consumers will carry the burden of that economic and political instability of other country through the intermediation of OPEC in the world market for petroleum products. Answer 8 The reason behind the success of Wal-Mart for the past age lies on its market assign and size which provide rooms for upgrade lowering down the prices of their goods relative to their competitors.Because of the large market size and share of Wal-Mart, they have been able to have more bargaining power to their suppliers in a form of price discounts since once Wal-Mart buys products to their suppliers millions of volumes of goods are at stake. This is the reason why suppliers would want to supply Wal-Mart due to large volume of order that they can get once they were able to close a postulate with the management of the Giant.At the end of the day, those price discounts that Wal-Mart was able to receive f rom their suppliers will give them enough room to further set the prices of their products lower as compared to their competitors, thereby, attracting more customers which eventually lead to experiencing high company growth in terms of profitability and sales volume.