Quasar

The economic concepts involved in marketing a new product are complex and require an in-depth analysis of domestic and global business. Businesses may find themselves as the sole provider of a unique product, or have merely transitioned to being one of many suppliers in the marketplace. International business adds the additional risk of even greater competition. For example, Quasar Corporation finds itself in the unique and strategic position of having developed a new, innovative type of optical notebook (University of Phoenix, 2010). Unfortunately, the privileges of innovation will not last indefinitely.

Apparent in domestic business and especially in international markets, the Product Life Cycle (PLC) Theory describes the introduction, growth, maturity, and decline of a product, and the competitive factors involved in the manufacture, marketing, and sales of the product (Daniels, Radebaugh, & Sullivan, 2004). According to McConnell and Brue (2005), the number of product suppliers, and pricing and non-price economic strategies are critical to organization and product success throughout the stages of product development. Thus, Quasar is likely to encounter the effects of PLC for its notebook, and must plan price and non-price strategies accordingly.

Therefore, after analysis of competition (e.g., number of sellers and producers in the market) and by effective use of pricing and nonprice strategies, Quasar may maximize economic profits by analysis and evaluation of the following market structures: (1) monopoly, (2) oligopoly and monopolistic competition, and (3) pure competition.

Monopoly

Pure monopoly exists when a single firm is the sole producer of a product for which there are no close substitutes (McConnell & Brue, 2005). Succinctly, in a monopoly the organization has control of the market. In a monopoly the organization sets the price; however, they face a downward sloping demand curve. A pure monopolist has no immediate competitors because...