ECO100Y5 Chapter Notes - Chapter 10: Complete Market, Price Discrimination, Taipei Metro
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ECO100Y5 Full Course Notes
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Chapter 10 monopoly, cartels, and price discrimination. Much like perfect competition is on one end of the spectrum where firms have no market power, monopoly is on the other end of the spectrum where firms have complete market power. We see that with all the boats in the market, they would not collect much shrimp. But after the storm when there was only one boat left, the received all of the shrimp and made all the profit. If they do make it, they receive monopoly profits and have full market power: government licenses, other legal institutions that make it difficult for firms to enter any market industry. Since monopolists have full market power, they set the price in the market. They can do this in one of two ways: set a single price, price discrimination. We can think about costs for the firm in the same way as in pc.
