Thursday, December 2, 2010

Post 3: 5 Recent Purchases

National 4-H Congress Hooded Sweatshirt: This is an example of Pure Monopoly because there is only one National 4-H Congress and they have a license that forbids anyone else from using the 4-H clover. Due to their trademark of that clover it makes them the only source for buying a National 4-H Congress hooded sweatshirt. This gives them the power to make the price extremely high but 4-Hers will still pay because you only have the opportunity to buy the sweatshirt at this conference.

Airport Baggage Fee: Monopolistic Competition is airport baggage fee because there are many airline companies to choose but most have a fee to check baggage. They have some control of prices but not complete control because they must compete with other companies. However if Continental were charged an excessive amount of money to check one page, consumers may switch to Delta who charges a lower amount.

Yellow Lab Puppy: Puppies are an example of Pure Competition because there are many places to get puppies. They are almost at a constant supply which means individual dog breeders do not have control over the price they charge. In order to assume business their prices can not be higher than a certain price.

Gas: Gas is considered Oligopoly because of the low amounts of gas companies. Because of their competitive nature and need to make profits individual companies can not knock their prices up too high or their costumers will go elsewhere so they really don't have much control over the prices. Gas is also a very standard product, there is not one company that has a unique gas that would make the value go up, they are all equal.

WaWa Breakfast Sandwich: Although there are close substitutes such as McDonald's breakfast sandwiches or 7-Eleven sandwiches there is no other "WaWa breakfast sandwich." There are small differences that separate WaWa from other companies making this is an example of Monopolistic Competition. There are many substitutes to WaWa's breakfast sandwiches but none of them are exactly like WaWa's.

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