Read/review the following resources for this activity:
In this paper, you will apply what you have learned in Chapter 17 to the firm or business you selected in order to see how the concepts can be applied to a business situation.
Keep in mind that throughout this course, papers are intended to bring real-world situations to the course material that we are covering each week. Part of your grade will depend on the connections you make between your chosen firm (which could include the economic environment of your chosen firm, the markets in which your chosen firm interacts with outside actors, the decisions your chosen firm makes, etc., depending on the particular question), the material from the chapters we covered in the week, and, when applicable, your own experience.
For the particular firm/business you selected*, identify any oligopoly market(s) in which the firm participates. Describe the market, and explain why you think the firms in that market are cooperating with or competing against each other. What can Oligopoly Theory say about your firm and its decisions? What would happen in the market if it became more competitive because additional firms entered the market? What would happen to your firm’s profit? Are Oligopolistic markets something that firms should seek out in order to participate in them?
If the firms are competing with each other in the market, what are the benefits and costs of trying to cooperate? If the firms are cooperating, what are the benefits and costs of trying to compete? Should the firm you are analyzing switch its behavior (remember, you’re looking at the decisions your firm can make—it cannot directly influence other firms’ decisions)? Why or why not?
*Note: Most firms chosen by students have some aspects of an Oligopoly in their output markets. For this week’s paper focus on those aspects. However, it is possible the firm you originally chose in week 1 is not a participant in an Oligopoly. In that case, you may choose another firm to discuss this week. If you are in this situation, please consult with the instructor.
Writing Requirements (APA format)
Grading and Assessment
This activity will be graded based on academic content, integration of resources, and college-level writing and grammar. Refer to the Written Analysis Grading Rubric (in Course Documents)
Course Learning Outcome(s): 1, 2, 5, 6
1. Apply the Ten Principles of Economics (basic economic axioms) to real-world situations.
2. Predict market outcomes using simple Microeconomic models.
5. Apply the simple Microeconomic models to real-world situations and determine how the assumptions or predictions of a model may need to be modified to apply to the real-world situations.
6. Analyze the implications of Government interventions on market outcomes and welfare.
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