External Influnces- Market Domiance Flashcards
Explain what is meant by a aquisition and merger
Acquisition- the takeover of one business by another
Merger- the joint cooperation between two businesses to create a joint entity
What is a monopoly
when one company and its product dominate an entire industry whereby there is little to no competition and consumers must purchase that specific good or service from the one company.
How can mergers and acquisitions lead to the creation of dominate firms
make companies stronger by expanding their consumer base, reducing marketplace competition and creating value that is greater than each company offers individually
Impact to other businesses of a dominant firm operating in its market
The risk of being pushed out the market and bought out by the dominate firm
How is market dominance is restricted and regulated in the uk
The Competition and Market Authority regulate the markets to ensure that competitiveness stays between business in order to keep the choice of services and products for the consumers
Impact of regulation of the market on business
enables business to act as well as constrains their activity and performance, generating contradictory effects, meaning their actions are limited for growth and can result int he business being split into multiple entities if the CMA feels its appropriate
