Unit 5 - Business decision: incomplete competition

Question 1

incomplete/imperfect competition

Answer 1

Markets in which individual companies can differentiate their products from those of the competition and this influence the price offered.

Question 2

monoploy

Answer 2

is a market situation in which only one company act as a supplier of a good.

Question 3

entry barrier

Answer 3

a reason why a company cannot access or enter a market

Question 4

4 concrete examples of monopoly

Answer 4

• stare-created monopoly: state garants a supplier an exclusive right to sell certain goods or services
• natural monopolies: public utilities (electricity, gas, water), high investment costs are first required to build a network or infrascructure
• monopolies through sole ownership of a critical resource: raw materials
• monopolies due to external company growth: acquisition of competitors or merge of two or more companies

Question 5

federal cartel office

Answer 5

german authority whose taks is to protect competition