ECF2731 Lecture Notes - Lecture 9: Form 10-Q, Bertrand Competition, Monopolistic Competition
26 Jul 2018
School
Department
Course
Professor
Document Summary
Lectures 8 and 9: monopolistic competition & oligopoly. Understand and recognize the various processes involved in investment decision making. Recognize and evaluate the various theories of the organisation. Large number of sellers that o er di erentiated products. Economic pro ts are possible in long-run equilibrium. Timely market structure information is required for optimal investment decisions. No entry and exit cost in the long run (but not totally free entry and exit in short run). Buyers and sellers do not have perfect information (imperfect. Opportunity for normal pro ts in long-run equilibrium. Set m = mr - mc = 0 to maximize pro ts, mr=mc. Monopolistic competition - roadmap: we apply "tools": 2. 1 output, price and pro t of monopoly rm. 2. 2 output, price and pro t of monopoly rm after entry of some competitors with close (but imperfect) substitutes. 2. 3 output, price and pro t of monopoly rm after entry of more competitors with perfect substitutes.
