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  2. Monopolistic competition - Wikipedia

    en.wikipedia.org/wiki/Monopolistic_competition

    A firm making profits in the short run will nonetheless only break even in the long run because demand will decrease and average total cost will increase, meaning that in the long run, a monopolistically competitive company will make zero economic profit. This illustrates the amount of influence the company has over the market; because of brand ...

  3. Monopoly profit - Wikipedia

    en.wikipedia.org/wiki/Monopoly_profit

    Although a regulated monopoly will not have a monopoly profit that is high as it would be in an unregulated situation, it still can have an economic profit that is still above what a competitive firm has in a truly competitive market. [2] Government regulations of the price the monopoly can charge reduce the monopoly profit, but do not ...

  4. Monopoly price - Wikipedia

    en.wikipedia.org/wiki/Monopoly_price

    When a firm with absolute market power sets the monopoly price, the primary objective is to maximize its own profits by capturing consumer surplus and maximizing its own. A monopoly accomplishes this by setting a price above its marginal cost and producing at a quantity that meets market demand and corresponds to the set price.

  5. Profit maximization - Wikipedia

    en.wikipedia.org/wiki/Profit_maximization

    Profit maximization using the total revenue and total cost curves of a perfect competitor. To obtain the profit maximizing output quantity, we start by recognizing that profit is equal to total revenue minus total cost (). Given a table of costs and revenues at each quantity, we can either compute equations or plot the data directly on a graph.

  6. Markup rule - Wikipedia

    en.wikipedia.org/wiki/Markup_rule

    Mathematically, the markup rule can be derived for a firm with price-setting power by maximizing the following expression for profit: = () where Q = quantity sold, P(Q) = inverse demand function, and thereby the price at which Q can be sold given the existing demand C(Q) = total cost of producing Q.

  7. Monopoly - Wikipedia

    en.wikipedia.org/wiki/Monopoly

    A PC company can make excess profits in the short term but excess profits attract competitors, which can enter the market freely and decrease prices, eventually reducing excess profits to zero. [21] A monopoly can preserve excess profits because barriers to entry prevent competitors from entering the market.

  8. Market power - Wikipedia

    en.wikipedia.org/wiki/Market_power

    In the short term, firms are able to obtain economic profits as a result of differentiated goods providing sellers with some degree of market power; however, profits approaches zero as more competitive toughness increases in the industry. [17] The main characteristics of monopolistic competition include: Differentiated products; Many sellers ...

  9. Competition (economics) - Wikipedia

    en.wikipedia.org/wiki/Competition_(economics)

    In the short run, economic profit is positive, but it approaches zero in the long run. Firms in monopolistic competition tend to advertise heavily because different firms need to distinguish similar products than others. [16] Examples of monopolistic competition include; restaurants, hair salons, clothing, and electronics.