Essay - Profit-maximizing Firms with Market Power + Advantages and Problems in...

profit-maximizing firms with market power + advantages and problems in setting prices

Profit maximizing ***** with market power which can set their own prices are usually located in transitional economies or ***** branches where the lack of resources is the main problem. There is an only firm in a given *****dustry.

Their enormous advantage ***** that in most cases ********** have no competitors or if there are some, they do not count. Giant companies who rule on their market have also ********** and disadvantages ***** concern them and also the society on which they were built.

The main advantages f***** the society is that those *****, by c*****solidating their position, they can offer secure jobs and regional stability. Their wealth, if the companies are interested in secur*****g a habitat, is also the concern ***** can became ***** wealth of the people near their area surroundings. If the companies know how to keep th***** advantage which gives them market power, having no choice in selecting other brands does not necessarily ***** as result the mo*****ony of products.

The disadvantages for the society are a result of an unsuccessful applied strategy which at the beginning was based on the advantages of the firm. For example, ignorance is always a way to brake ***** ***** of the firm. Ecological policies and social policies, when ***** firm has reached a high level of development have to be strongly supported and renewed. Not taking those elements into consideration or ignoring them can lead also, in extreme cases ***** loosing the ***** to a new arrived on the market and generally unknown firm.

The advantages of ***** company can be many and various if the management is highly-pr*****essional ***** the strategies ***** ***** accordingly. However, since an advantage can easily ***** transformed into a dis***** by not giving it ***** proper *****ttention, the ***** of the firm and indirectly all ***** employees have a gre*****t responsibility towards securing the future of the *****. At this *****, ***** have to work intensely ***** short-terms strategies, for any wrong step can create a breach on ***** market and *****fore lead the ***** for other companies. Setting the ***** is one of the best advantages ***** a comp***** c*****n rely on. It ***** the opportunity to take out all other small firms competitors if necessary ***** it some***** *****s away the pressure of c*****sumers' demands fluctuation. To this extent, it does not matter ***** quantity anymore, or at least not as much ***** it does in all other situations, but the price. Securing the market is a must, in order to *****chieve the ma***** objective which is to obtain ***** highest profit.

***** ***** of those kind of firms are mostly related to the price or the quality of ***** products. An error that occurs in their way ***** dealing with the ***** is that when finding themselves all alone they start ***** think ***** this is the general and normal state which can never after be d*****turbed or