Evaluating Market Structures - 1574 Words

Evaluating Market Structures Economics 212 Abstract Many types of market structures exist, with each market structure proving more effective than the other for certain firms. If a firm choses to enter a different market structure then that firms financial success will either diminish or flourish accordingly; the latter is usually the case regarding monopolistic competition market structures in the short run. Firms in this market structure must compete by using strategies, hiring skilled labor, evaluating their products, and differentiating their products to survive in the long run. Starbucks is an example of a monopolistic competitive firm that understands how that market structure works, thus giving them substantial profits in the past†¦show more content†¦The supply can increase (causing the curve to shift to the right):1. If wages rise (causing more people to be attracted to the market as sellers of labor services); 2. If population increases; 3. if attitudes change, such as more women wanting to leave home and enter the work force; The supply can decrease through emigration, falling wages, negative attitudes toward work, or even warfare (which removes people involuntarily from the workforce). The demand for labor is also affected by its cost (demand goes up if unit labor costs through falling wages or rising productivity go down), by changes in the size of the workforce, etc†(Supply and Demand of Labor). Starbucks Market Structure Starbucks is a monopolistic competitive firm which produces products that are not identical to another firms products. They may sell coffee, but their quality of coffee is different than compared to another firms coffee. Market Structures Effectiveness Monopolistic competitive firms have barriers to entry that are designed to block potential entrants from entering a market profitably. They seek to protect the monopoly power of existing (incumbent) firms in an industry and therefore maintain supernormal (monopoly) profits in the long run, making the market less contestable. Some of these barriers, pricing limitations, patents, and trademarks help firmsShow MoreRelatedMarket Research : Evaluating And Determining The Market Rates For Benchmark Jobs1125 Words   |  5 PagesMarket Research: Market- pricing is the other method used in combination with job classification to determine pay. This method outweighs job classification and focuses on having a market- based structure. Valuing jobs based on the external competitive worth it the primary focus to evaluating and determining pay of jobs in the compensation structure. With this method, jobs are placed into a grade structure based on the competitive pay of the job. 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