Test

Market Structure

Brittney Rice, Emily Shore, Dianna Godt, James McGrath, Michael Hesseling

Economics – 561

David Francom

September 22, 2013

Team A was able to cover all the information for week 3 and given all the information about monopolies, market structures and monopolistic competition and oligopolies there was a lot of information to cover. Responding to the amount of information Team A began by reading the assigned chapters and discussing the information in the teams’ assigned area.

Monopolies

Monopolies:

Team A discussed monopolies and really seemed to grasp this concept the best. A pure monopoly exists when a single firm is the sole producer of a product for which there are no close substitutes.  The main characteristics are as follows:

* Single seller - a single firm is the sole producer of a specific good or the sole supplier of a service.

* No close substitutes - a pure monopoly's product is unique in that there are no close substitutes.

* Price maker - the monopolist controls the total quantity supplied and thus has considerable control over price.

* Blocked entry - certain barriers keep potential competitors from entering the industry.

* Non-price competition - the product is either standardized or differentiated.

During the week, there were multiple examples of monopolies posted by students. The text spoke about De Beers as being an example of a monopoly. I found that to be very interesting as I am presently employed with a large diamond manufacturer that has signficant business dealing with De Beers. De Beers controls 55 percent of the world's supply of rough-cut diamonds.  De Beers is a family of companies that dominate the diamond, diamond mining, diamond hops, diamond trading and industrial diamond manufacturing sectors.  De Beers is active in every category of industrial diamond mining which include open-pit, underground, large-scale alluvial, coastal and deep sea.  Mining takes place in Botswana,...