hopping for a new TV, would you prefer to buy one (a) under perfectly competitiv
ID: 1157400 • Letter: H
Question
hopping for a new TV, would you prefer to buy one (a) under perfectly competitive market conditions, (b) from a regulated monopoly, (c) from an oligopoly or (d) under monopolistic competition market conditions reasoning. what market structure would result in the lowest price? If you choose a market structure that doesn't offer the best price, why did you choose it? ? Explain your In your answer, also be sure to explain the characteristics of each of these four market structures. Do this to explain the market structure you chose, and the three you did not.Explanation / Answer
If one is shopping for a new T.V. then one will buy the T.V. under the monopolistic competition market condition. This is because T.Vs are sold as differentited products by different brands with different features in different brands of T.V. Also advertising and marketimg also plays an important role in T.V. market. Although perfectly competitive type of markets result in lowest price, but the market structure of monopolistic type will be chosen in this case as demand for T'V is relatively elastic and not perfectly elastic as is the case in perfectly competitive markets and people agree to pay higher prices for more features and specifications.
It is not advisable to buy T.V. under monopoly as the price will be very high and consumer surplus will be low. Also, in oligopoly type of market structure the prices will be high and only few firms will be selling the product with not much choices available in the market.
Thus, the best form of market structure to buy T.V.is monopolistic competition.
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