Buisness Competiton Flashcards
(16 cards)
What are the advantages of competition to firms, consumers, and the economy?
Efficiency, choice, quality, innovation, and price.
What are the disadvantages of competition to firms, consumers, and the economy?
Potential negative impacts on small firms and market stability.
What are the advantages of large firms?
Economies of scale, greater resources, and market influence.
What are the disadvantages of large firms?
Bureaucracy, less flexibility, and potential for monopolistic behavior.
What are the advantages of small firms?
Flexibility, niche markets, and personalized service.
What are the disadvantages of small firms?
Limited resources and market reach.
What factors influence the growth of firms?
Government regulation, access to finance, economies of scale, desire to spread risk, and desire to take over competitors.
What are reasons firms stay small?
Size of market, nature of market (niche), lack of finance, and aims of the entrepreneur.
What is the definition of monopoly?
A market structure where one business dominates the market.
What are the main features of monopoly?
One business dominates the market, unique product, price-maker, and barriers to entry such as legal barriers, patents, marketing budgets, technology, and high start-up costs.
What are the advantages of monopoly?
Efficiency, choice, quality, innovation, price, and economies of scale.
What are the disadvantages of monopoly?
Reduced choice and potential for higher prices.
What is the definition of oligopoly?
A market structure characterized by a few firms that dominate the market.
What are the main features of oligopoly?
Few firms, large firms dominate, similar products, barriers to entry, collusion, non-price competition, and price competition.
What are the advantages of oligopoly?
Choice, quality, and innovation.
What are the disadvantages of oligopoly?
Collusion and cartels fixing high prices, and price wars between oligopolies.
