6-2 Simulation Discussion: Monopolies and Monopolistic Competition

Words: 1591
Pages: 6
Subject: Premium Writing

A monopoly is a firm that is a sole seller in a market. Monopolies can decide to set different prices for different consumers through price discrimination. In monopolistic competition, there are many firms that sell products that are similar but not identical.
First, play the simulation game Price Discrimination in the MindTap environment. In this discussion, you will share your experiences playing that game. Your work in this discussion will directly support your success on the course project.
In your initial post, include the image of your simulation report in your response. See the How to Submit a Simulation Report Image document for more information. Then, address the following questions:
Explain which types of market inefficiencies derive from monopolies. Use examples from the textbook to support your claims.
Describe the types of inefficiencies that derive from monopolistic competition. Use examples from the textbook to support your claims.
How are monopolies and monopolistic competitive firms profitable? Use examples from the textbook to support your analysis.In your responses, comment on at least two posts from your peers by providing examples from the news of monopolies and firms in monopolistic competition markets. Compare and contrast the two of markets.

You will be signing into my Cengage.com and going on. Email is vishnuralhan@gmail.com. Password: Minecraft1 Once you’re in, please take screenshots of module 6 games. Play it and take ss to upload in your post!

Response 1: Hello class!
A monopoly exists when a seller is the sole provider of a certain product in a market. This is inefficient in a market because the organization can raise the prices above marginal cost and buyers have no choice but to pay those prices, giving them much greater market power than any single firm in a competitive market. Our textbook described an example in which a town has only one well therefore people have to pay whatever price they decide to charge. “For a necessity like water, the monopolist can command quite a high price, even if the marginal cost of pumping an extra gallon is low.” (Mankiw, 2021).
Monopolistic competition is when there are several producers competing against each other but selling products that are differentiated, not perfect substitutes. When this occurs, no business has total control over the market price. Another inefficiency that occurs is that consumers may perceive that there are differences other than just price between the products. For example, companies may sell products that contain similar ingredients and perform the same job, but consumers may perceive one is better than the other because the price is higher. Often, monopolistically competitive firms will charge more than a firm would under perfect competition. While a monopolistic competitive firm can be profitable inan increase in average total cost.

Response 2: ood evening, class!
Although I had difficulty with the windows on the screen cutting off sections of the simulation, overall this week’s simulation was a success! (I screamed and did a happy dance in my living room because it worked so well and woke up our 4 year old)! I profited in each area and grew in profits each round with the exception of round four. I feel this simulation showed variables within monopolistic markets.
Monopolies can cause great market inefficiencies because one firm or industry creates a power hold, leaving no room for movement or equal substitution for a consumer. Prices within a monopoly are above marginal cost and often unfair or not the true value of a product or good. That fact that a firm or industry holds the power of this solitary good or service within the market, they may set the price at whatever cost they deem fit unless there is government intervention. The monopoly stands true within the the quantity as well, which can be a a major inhibiting factor within the pharmaceutical markets and can even be detrimental to consumers.
Inefficiencies derived from monopolistic competitions may be great than that of a single monopoly and this is in part due to imperfect information available to both buyers and sellers. Due to the market power, firms or industries set prices above marginal costs which often can lead to deadweight losses. The demand curve within a monopolistic market is downward sloping and this leads to excess capacity in the long run. This is seen often in the clothing industry; likely because there is an unclear perception that products or services may be valued or differed for something other than price or even quality. Monopolies and Monopolistic competitive firms can be profitable but this is most often seen in the short-run. Price discrimination play a large factor here. Within monopolies,
demand can be highly-elastic. No profit can be made is a consumer is not wiling to pay the prices.

demand can be highly-elastic. No profit can be made is a consumer is not wiling to pay the prices. Monopolies and Monopolistic competitive firms can be profitable but this is most often seen in the short-run. Price discrimination play a large factor here. Within monopolies, demand can be highly-elastic. No profit can be made is a consumer is not wiling to pay the prices. sloping and this leads to excess capacity in the long run. This is seen often in the clothing industry; likely because there is an unclear perception that products or services may be valued or differed for something other than price or even quality.
Monopolies and Monopolistic competitive firms can be profitable but this is most often seen in the short-run. Price discrimination play a large factor here. Within monopolies, demand can be highly-elastic. No profit can be made is a consumer is not wiling to pay the prices. within the pharmaceutical markets and can even be detrimental to consumers.
Inefficiencies derived from monopolistic competitions may be great than that of a single monopoly and this is in part due to imperfect information available to both buyers and sellers. Due to the market power, firms or industries set prices above marginal costs which often can lead to deadweight losses. The demand curve within a monopolistic market is downward sloping and this leads to excess capacity in the long run. This is seen often in the clothing industry; likely because there is an unclear perception that products or services may be valued or differed for something other than price or even quality.
Monopolies and Monopolistic competitive firms can be profitable but this is most often seen in the short-run. Price discrimination play a large factor here. Within monopolies, demand can be highly-elastic. No profit can be made is a consumer is not wiling to pay the prices.

the short run, the effect of its pricing will cause a decrease in demand in the long run and an increase in average total cost. better than the other because the price is higher. Often, monopolistically competitive firms will charge more than a firm would under perfect competition. While a monopolistic competitive firm can be profitable in the short run, the effect of its pricing will cause a decrease in demand in the long run and an increase in average total cost. substitutes. When this occurs, no business has total control over the market price. Another inefficiency that occurs is that consumers may perceive that there are differences other than just price between the products. For example, companies may sell products that contain similar ingredients and perform the same job, but consumers may perceive one is better than the other because the price is higher. Often, monopolistically competitive firms will charge more than a firm would under perfect competition. While a monopolistic competitive firm can be profitable in the short run, the effect of its pricing will cause a decrease in demand in the long run and an increase in average total cost.

inecraft1 Once you’re in, please take screenshots of modules 5 games. Play it and take ss to upload in your post!

types of markets.
In your responses, comment on at least two posts from your peers by providing examples from the news of monopolies and firms in monopolistic competition markets. Compare and contrast the two types of markets.
To access your simulations, click the simulation link found in the module.
Explain which types of market inefficiencies derive from monopolies. Use examples from the textbook to support your claims.
Describe the types of inefficiencies that derive from monopolistic competition. Use examples from the textbook to support your claims.
How are monopolies and monopolistic competitive firms profitable? Use examples from the textbook to support your analysis.
In your responses, comment on at least two posts from your peers by providing examples from the news of monopolies and firms in monopolistic competition markets. Compare and contrast the two types of markets.
To access your simulations, click the simulation link found in the module.