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Eco Essay

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Submitted By Krissyface4
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FINAL COMPETITIVE PAPER
ECO 204
Kristian Morales
April 1, 2013

In 2007, the potato chips business was indeed extremely competitive in the Northwest. It was competitively structured and in the long-run competitive equilibrium; firms were earning a normal rate of return and they were competing in a monopolistically competitive market structure. In 2008, two smart lawyers quietly bought up all the firms and began operations as a monopoly called “Wonks”. To operate efficiently, “Wonks” decided to hire a management consulting firm, in which estimated a different long-run competitive equilibrium. In this specific essay, I will explain how a company ran as a monopoly will benefit the stakeholders, the changes in regard to pricing, an output in the two varying markets, as well as determining which market structure is more advantageous to “Wonks” which to the consumers. A Monopoly is a market condition in which a company or a group of companies command the supply of specific goods and/or services. In a monopoly the entry of other competitors is prohibited or vastly constrained. Monopolist corporations maintain high prices, they control the output and usually have little consideration for the end consumer. Most general monopolies typically create a barrier of entry by imposing government policy and patents to keep the competition out of the market. The stake holders involved will be making a profit from both sides instead of one. The change of monopolized and monopoly would be different companies competing for total utility to rise by dropping prices for people to buy more of compared to owning both sides; being able to compete with each other by making profit off of each other. The difference between monopolized is that it’s being done already and monopoly is trying to buy everything to control the market. The

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