Duopoly can have the same impact on the market as a monopoly if the two players collude on prices or output. Characteristics of Duopoly 1. The number of sellers in this market structure is only two. 2. The decision of the sellers is not independent of each other. 3. The change in price and output by one seller affects the other seller who reacts to the change. 4. The product can be homogenous or differentiated. 5. The decision variables include price, product differentiation, selling expenses, etc. but the decisions depend upon the strategies of the competitor.
Product differentiation is the entry barrier and also the firm dominating the market can pose as an entry barrier. Two kinds of Duopolies Duopoly Market Bertrand Duopoly Cournot Duopoly 1. Cournot duopoly: If competition between the two companies is based on the quantity of products supplied. The duopoly members essentially agree to split the market. The price each company receives for the product is based on the quantity of items produced, and the two companies react to each other’s production changes until equilibrium is achieved. 2. Bertrand duopoly: The two companies compete on price.
Because consumers will purchase the cheaper of two identical products, this leads to a zero-profit price as the two competitors attempt to attract more customers (and thus more profit) through price cuts Airbus and Boeing Airbus * 1970: Airbus was formed as European consortium of French and German companies’ Spain companies joined the consortium * 1979: * British Aerospace joined Airbus Industry. * Each of the four partners operated as national companies * Airbus developed a deserved reputation
The Business plan on Retail Buyer Company Products Buyers
Executive Summary This business plan details the launch of a start-up company known as the Import Export Company (IEC). The company functions as a 'middleman' in purchasing housewares from manufacturers in China and reselling the products to retail buyers in the US and Canada. The Import Export Company is primarily an independent import / export business. The products we import from China are ...
