ECON 104 Chapter Notes - Chapter 8: Bc Transit, Via Rail, Bc Hydro
8 Apr 2016
School
Department
Course
Professor
Document Summary
Firm rather large compared to market we say it has market power. Firm may change price their market power with monopolist, price searchers or monopoly power. There are more like costly information may create market power. Price searcher faces negatively sloped demand curve for it"s product. Price taker are able to charge same price for any quantity they can produce (face horizontal demand curve) Market failure: market fails to produce outcome that are in a society"s best interest. Crown corporation: companies usually created by provincal or federal government and government usually owns 100% of their assets. Some started as private company and were acquired by government. Examples - federal is bank of canada, canada post, via rail canada inc. British columbia - bc hydro, icbc, bc transit. Force private companies that are regulated to produce more efficient quantity and set lower price but let companies deal with their cost min. Government regulates via rate of return regulation.
