Total 10 point if you complete all three questions. Q1 ,2,3 and 4 have each 1 points, but Q5 has 6 points.
Q 1) What is the price leadership model of Oligopoly pricing and what are its tactics?(1 point)
Q 2)” In monopolistically competitive markets, neither allocative nor productive efficiency is realized” explain.(1 point)
Q 3) Do you agree that companies under monopolistic competition can have a profit in the long run?
If yes, why? if no, why not? (1 point)
Q 4) Compare MPP (marginal Physical product of labor) and MRP (marginal revenue product of labor). (1 point)
Q5) Treasure Hunt: a) Go to www.cengage.com/sso (Links to an external site.) web site. At Bookshelf of Arnold economics of 11th edition, click SSO Course Mate for Arnold economics menu under resources to lead to Course Mate of Economics(11th ed) by Roger A Arnold . Then, click Ch 27 to get access to “Sample Quizzes” at left side menu bar. Describe #3 question and its correct answer with logical explanation.(3 point)
b)After watching” BBC Video ” of Ch 25 , 27 , 28 and 29 at www.cengage.com/sso, (Links to an external site.) analyze the content of one video by relating into economic theories. (3 point)
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If you make a comment to the topic (2.5 points) and a response to other’s comment(2.5 points), you can earn maximum 5 points of credit.
Your comment to each question has to be more than five(5) sentences based on researched facts and logical analysis to earn the full credit. Also your response to other has to be more than five(5) sentences based on researched facts and logical analysis to earn the full credit.
STRATEGY FOR THE OLIGOPOLY
After world war II, young Tucker tried to break in the automobile business with his original “Tucker Torpedo” automobile.(You should see the movie”Tucker”) But the Big three automobile makers(GM, FORD, and CHRYSLER) formed their own exclusive club, not allowing a new comer to join the club. With a plot(bully tactic, squeeze the capital, or tarnish Torpedo’s credibility), they destroyed young Tucker’s dream to be a major car maker.
Suppose you are in the same position as Tucker’s to break in the Oligopoly market(Big three ).
Q1) What’s your own strategy to survive and prosper in the oligopoly jungle? (0.5 point)
Q2) Is it an good idea to patent his torpedo first and work for the big companies until he accumulates enough capital to compete against big guys? (old saying, if you cannot win over your opponent, try to make your opponent as your friend, then regroup , reenergize and beat it up later) or build your business quietly and slowly outside of Big firms’ market territory or radar such as early growth strategy of WalMart in supermarket industry or Google in internet search engine business or what other idea of yours? (0.5 point)
Q3) 30 years later, another young businessman, named Bill Gates first worked for IBM with his licensed operating system called MS -Dos program (although young Bill Gates originally bought Dos program from somebody else). Later he bulit his own empire called Microsoft.
Despite of the difference of the initial sunk cost between a car industry and a software industry, please compare Tucker with Gates in terms of their business strategy. (0.5 point)
Q4) After over a half century later, another visionary car maker, Elon Musk emerges with an electric car of Tesla. What is a future of Tesla? Could it be the fate of another Tucker? if so, why? (0.5 point)
Q5) or Could it be another successful exception as a new member who survived and becomes prosperous in an Oligopoly corporate club due to another niche market of electric cars? If so, why? (0.5 point)
Note: Preston Tucker’s open letter is in the followed link.