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Help the mayor understand market structures
Market Structures
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Help the mayor understand market structures
Description of market structures
Market structures are generally described as the number of firms in the market producing similar goods and services and the market structures greatly influence the different behaviors of individual firms in the market. They help to determine how a firm can price its goods and services. These include four basic market structures that are namely, perfect competition, monopolistic competition, oligopoly and the monopoly structure.
In perfect competition, the market structure is characterized with several players i.e. several buyers and several sellers. The market deals with products that are similar and undifferentiated. The market is so large that the activities of an individual buyer or seller do not affect the market. The pricing and the production levels in this market depends on the demand and supply of the market. This market structure together with its partner market monopoly is called the extreme forms of market. In this market the products are similar and several and that is the reason why there are several substitutes in the market. This is the reason why when a single firm in the industry raises its price, customers or consumers will shift to the rivals for a better price for a similar service. Therefore the firm loses its share of the market by a slight increase of the prices (Clement, 2013).
This is a very unique market structure where the producers cannot maintain spare capacity. By spare capacity the economists mean that the firms have ability to exploit the resources in the industry but not to exhaust them one hundred percent. But in the case of perfect market where profitability is key to the firms ensure that they don’t work with spare capacity and hence utilize the resources fully.
In monopolistic competition, there exists an imperfect competition that has both characteristics of a perfect market and a monopoly. This market structure is related to a monopoly in that the goods can be differentiated and be sold at a price determined by the producer. It is also related to a perfect market since the market allows for free entry and exit; there are several players in terms of buyers and sellers. In short run, the companies in this market structure just like monopoly have the power to generate profits. In the long run, other companies will enter the markets and benefit from part of the profit through differentiation. The firm later becomes more of a perfect competition where they cannot dictate profit or make super normal profit. At complete lack of government intervention this market structure falls under a natural monopoly. The presence of a coercive government monopolistic competition will fall under government granted monopoly.
According to Edward Hastings, in his book theory of monopolistic competition, there are many producers and consumers but no single firm has control over the market price. There are few barriers to entry (Kelly, 2013).
In an oligopoly, we can say that there are only few firms that make up an industry. The firms have control over the price just like a monopoly. Every oligopoly all over the world has control over the prices and high barriers to entry. The firms in this market structures are independent and produce nearly identical products, the independence comes about due to the market forces. Three conditions for oligopoly were established by early economists. First, for a market to be oligopolistic, it must have few firms that are large in nature. This is a condition that is essential in distinguishing oligopoly from other market structures. Secondly, for a market to be oligopolistic there must be high barriers to entry as it distinguishes oligopoly from perfect market and monopolistic competition. Thirdly oligopolistic firms can produce products that are similar in nature or are differentiated (Clement, 2013).
In monopoly, there is a single supplier in the whole market. For the purposes of regulation, for instance, in Kenya a monopoly exists when a single firm has a control of more than twenty five percent to itself. Monopolies form due to a variety of reasons that includes; exclusive ownership of resources that are scarce is by one supplier, for instance, windows are Microsoft’s brand with which they have monopoly power. Producers may have patents and copyrights over ideas and designs that last for very many years. During this time the exclusive use of ideas and design is with the inventor. The major characteristics of monopoly are that they can be able to maintain supernormal profits in the long run. For all the firm’s profits are maximized when MC=MR. Secondly we can say that with no close substitutes the monopolists can derive super normal profits all the year (Clement, 2013).
Discuss two characteristics of each the market structures
Monopolistic competition market structure has got several characteristics, but in this paper we basically look at two crucial characteristics that have enormously shaped the market structure. The characteristics include existence of differentiated products whereby unlike perfect competition where the products are exclusively similar, in monopolistic competition, the products are highly differentiated. Differentiation means that though the products are substitutes of one another, they have been made to look different from that of other competing firms through different packaging and branding. Therefore for a firm to be able to sell its products they have to do a lot of advertising in order to create market awareness (Kelly, 2013).
Secondly, there is free entry and exit in the market. This is a kind of market structure that is similar to perfect market in this regard, several players both the buyers and sellers are allowed to enter and exit the market at will. When a firm is making supernormal profits other firms will be attracted to join the industry and benefit from this lucrative business and by doing so the monopolistic firms will start to realize normal profit which continues as more and more firms enter the market. When the market is saturated, the firms will start to realize loses hence other firms will start to exit the market until the firms that remain start realizing normal profits (Levy, 2011).
In Oligopoly there are few large firms in the industry and this is one of the most important characteristic of this market structure. The industry deals in products that are difficult to differentiate and the activities of one firm affect the other firm. The firms are few that the information pertaining one firm is known by the other. The prices of the goods are determined by the firm yet an increase or decrease of the prices by a firm is countered by similar reaction by the competitor, therefore it is worthless to increase or reduce prices in order to raise revenue.
Secondly, there are high barriers to entry for other firms to enter the industry, they have to face the several barriers that are created by the other players in the industry. Such barriers include legal barriers, legislative barriers and economic barriers. Legal barriers include the patents and the copyrights yet legislative barriers are attached to state corporations that are created by acts of parliament. On the other hand economic barrier are created by the large amounts of capital required to start the business (Kelly, 2013).
In Monopoly, there is existence of a Single firm in the industry. In this market structure, the firm is also the industry. There is only one producer who serves several consumers. The firm being the only producers they make supernormal profits in the long run. The firm enjoys monopoly due to the several barriers that exist either due to economic reasons or legal reasons. There is also the determination of the price. Here, the firm determines the market prices but for a firm to sell an extra unit of the product the firm has to reduce the prices and attract more buyers. The prices do not change due to the market forces of demand and supply but if the prices go high the buyers usually panic and avoid purchasing the goods (Levy, 2011).
In Perfect competition, several buyers and sellers In this market structure there are several buyers and sellers, this is due to the free entry and exit in the market. The activities of individual buyers and sellers do not affect the market, the price of goods and services are determined by the market forces of demand and supply. There is also existence of non-differentiated goods. In perfect market, the goods and services are similar and are not different from the competitor’s product. The goods are direct substitute of one another and for one to sell an extra unit more than the competitor; they have to establish a customer base of loyal buyers.
Identify one real life example of market structure
In a Perfect Market an example of the firm that belongs to this category is the aviation industry where there exists different airline companies like the British airways, Qatar airways, emirates airline, jet airways, virgin blue airlines , air Canada and the air china are the major examples in the aviation industry that help illustrate a situation where there are different players in the market and at the same time there are many users of the various services provided in the industry.(Mudida, 2013).
In Monopolistic Competition, an example of firm in this market structure is the Mc Donald’s food stores. They belong under this category of market since they sell highly differentiated food products to a market with several buyers and sellers. The fact that Mc Donald’s can dictate the prices in which they can sell their products without affecting the demand for their goods puts them under the monopolistic market.
An example of firm that falls under the Oligopoly market structure is the British Petroleum company. It trades in the market with few players and competitors such as the shell BP and Kenol/Kobil. They change prices depending on the prices of the other and sometimes they can even form a merger (Mudida, 2013). In Monopoly, an example of a company under the monopoly market is the cable company in India that faces no competition and is characterized by poor quality and poor service delivery to Indian citizens. This is due to its monopolistic nature as compared to the perfect market scenario where it would be challenged to offer better service. (Levy, 2011).
References
Clement, D. (2013). Introduction to economics, New York NY, McGraw Hill
Kelly, G. (2013). Economics and its modern perspectives, New York NY, McGraw Hill
Mudida, G. (2013). Modern Economics, Nairobi, Strathmore University Press
Hastings, E. (2012). Advanced Micro economics, London, Sage
Levy, S. (2011). Economic Theory and Practice, New Jersey, Prentice Hall
The ground-state electron configuration for Carbon (Atomic number 6) is 1s22ss2p2
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Date:The ground-state electron configuration for Carbon (Atomic number 6) is 1s22ss2p2
The ground-state electron configuration for Fluorine (Atomic number 9) is 1s2 2s2 2p4
The ground-state electron configuration for Magnesium (Atomic number 12) is 1s22s22p63s2
Silicon has four valence electrons.
C2Cl4 Tetrachloroethylene
CO2 Carbon Dioxide
CH4O Methanol
Non-bonding valence electrons
The structure of urea is sp2 hybridized.
+ 1
-1
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Four
Two
Answers for question 19 and 20
D
C
No, the reaction will not take place as written because the strongest acid reacts with the strongest base to give the weakest conjugate acid and the weakest conjugate base. D (pKa = 15.7) is a stronger acid than A
b
Phenol
Ethanol
In Phenol, the lone pair of electrons on oxygen delocalizes into the benzene ring (mesomeric effect) which reduces the electron density in the O-H bond. The O-H bonds is weaker and therefore breaks more easily in comparison to ethanol.
C3H6O.
b. Molecular mass= 58
c. 27.6 This is similar to the percent of Oxygen in the empirical formula.
a
d
a
The Ground And Nature Of Faith And Reason
The Ground And Nature Of Faith And Reason
Introduction
The mind of a human being is not made to only think of true things or even suited to full extent of all the things. The mind is able to meet with so many situations that it is unable to comprehend those that are important among the ones that can be kept aside. This however should not make a person lose hope in the search of truth or even make somebody think that he or she cannot be in a position to know or learn anything. It is important for human beings to know that they have been sent on earth which is full of all the faculties so as to obtain the necessary knowledge for human consumption (Locke, p1). Even after storing experience and natural history as is important in the work of philosophy or understanding, the process of understanding is not enough to deal with the philosophy of reasoning. The process of invention comes about as a result of man thinking and also writing such that after reading and writing, better things will be on the way. (Bacon, p11).
This paper aims at looking at the ground and nature of faith and reason. I will employ several examples to show how faith and knowledge are linked in the proposition of truth.
It is believed that human mind has its origin from barbarism (Alembert, p7). The brain was like a child who is eager to obtain ideas though it is difficult at first due to the low development. For instance, philosophic spirit is as a result of great men who have written quite a lot to illuminate the world. Francis Bacon Chancellor in England is one of the philosophers whose work deserves to be read. He had very extensive and sound views, various subjects with a good style of writing. He started by looking at the general view of natural science, divided it into several branches and continued to research on what people knew on the said subjects. He considered philosophy to be part of knowledge which makes people happier and better. His work is based on the analogy that he obtains facts, compares and analyses experiments and performs experiments. He then invites other people to do the experiments and learn so that they can be perfect.
Reason and Faith
The word reason has several meanings. It can be said to be for clear principles and truth, fair deductions and also for cause and especially for final cause. However, in my argument I will look at reason in a different perspective. That is, the way it stands in man. The faculty in which human beings are differentiated from the beasts, and the fact that man is better than the beasts. If the general knowledge involves the way we perceive the agreement or the opposite of our ideas, and the prior knowledge of existence of the things we see except for the case of God whose existence is evident to all men. The most important part of our knowledge comes from intermediate ideas and deductions. Human beings have the need to examine, find out and compare all the things that are found in nature. The aspect of finding the means, applying them in discovering certainty in the means and probability is what is referred to as reason. Reason looks at the indubitable connection and the necessary ideas in every step of any demonstration which produces knowledge. There is no man who was born with a methodical mind or was a better logician like Mr. Locke. However, he was not a better mathematician. He could not spend a lot of time with calculations to an extent of getting tired and even though this was the case, nobody could ever give better proofs than this man. It was said that it was like he had a geometrical head and therefore did not require geometry. In early days people were subjected to reasoning in the same manner as they reason today. Mr. Locke used to reason a lot and therefore was able to solve calculations perfectly.
Anaxagoras who taught mankind the fact that sun was greater as compared to Peloponnessus, heaven was made of stones and the fact that snow was black also said that the soul was immortal and an aerial spirit. All this was as a result of reasoning. He used what he knew to compare with whatever he did not know. He went on to say that the soul was part of God which is a very sublime (Francois-Marie, p 191). Aristotle who was not very intelligent believed that all men understand the same way. Plato, Aristotle and Socrates reasoned that the soul was eternal and corporeal.
Sometimes our reasoning may fail us. It is able to elevate the way we think very high and yet comes back to a low opinion on some other aspects. Reasoning is able to fail us whenever the ideas we had fail (Locke, p6). The moment an individual does not have an idea, reasoning stops and we reach the end of reckoning. On the other hand, now that our ideas are imperfect, the reasoning capacity becomes puzzled and often at a loss due to confusion, imperfection of ideas or obscurity. Whenever we have clear, distinct and perfect ideas our reason does not at any one time meet with any difficulty or come across any contradictions.
Newton who was sure of what he wanted. To prove that Descartes’ vortices was not a better way of explaining planet movements (Motte, Cajori, p1). He had reasoning that there is a certain force which is able to induce planets mutually so that they can attract each other (d’Alembert, p13). He utilized the momentum theory. He also came up with the notion that matter had some properties which many people had not reasoned about. This is all because he had an idea, which he went on to reason about and came up with the theories. He perceived his ideas to make conclusions. It is advisable that human beings should not proceed on wrong principles. False principles always lead to the mind having difficulties and contradictions of what we really want to achieve.
Reason and faith go hand in hand. Faith is actually controlled by reason (Locke, p7). Faith affirms the mind that whatever the brain is reasoning is bound to happen. It is believed that;
“He that believes without having any reason for believing may be in love with his own fancies; but neither seeks truth as he ought, nor pays the obedience due to his Maker, who would have him use those discerning faculties he has given him, to keep him out of mistake and error. He that does not this to the best of his power, however he sometimes lights on truth, is in the right but by chance; and I know not whether the luckiness of the accident will excuse the irregularity of his proceeding”.(Locke, p7)
I also agree with traditional revelation which is able to guide us in understanding the prepositions that are knowable through reason. Truth could be identified through revelation which is discovered by reason and the ideas that we could be having naturally. This means that through the might of God men could use their faculties to make great discoveries. Every human being has an experience of using faculties or power to form various ideas. The right way of using these faculties is referred to as common sense (Toland, p2). God has given us a clear discovery of things through contemplating and having knowledge of ideas. The early great philosophers were able to discover several things such as mariner’s compass, art of painting using oil, printing, making glass, and other discoveries such as restoring some sight to old men who were blind by using spectacles, they discovered the use of gun powder among others(Francois-Marie, p 53).. This revolution was done through reasoning and faith. There must be an agreement of an idea with the mind for people to discover something (Toland, p3). There are however other very useful interventions that man was able to discover. This was due to the mechanical instinct that human beings possess. The philosophy through which man was able to discover fire, make bread, work with metals, melt them, build houses among others is very astonishing. Chancellor Bacon through experimental philosophy was able to make pneumatic machines where he was able to discover air elasticity. He believed in enquiring. He wanted to know the exact reason for the elasticity. Whether it is the magnetic force between the earth and the other bodies like the moon and sun or what caused the elasticity. Through the reasoning and use of faculties these men were able to get their answers.
There are other things that we cannot be in a position to know their past, present or future through our natural way of using our own faculties. These are beyond human discoveries. They can only be revealed by God. For instance, when some of the angels of God rebelled against Him and they lost their state of happiness, and one of them who is known as Satan was thrown in a fire den. Other ideas for instance the fact that the dead will rise and have a chance to live again among others are things that are beyond our discovery and are therefore known to be matters of faith. In this case, reasoning is not involved at all (Locke, p8).
In conclusion, where reasoning affords specific knowledge, the faith dominion reaches. This will lead to the discovery of truth which if one is not able to obtain through the natural way of thinking and reasoning, God will bring it to man through His way of eternal fountain of knowledge. What God reveals to man is true and nobody should doubt that. The object of faith whether in divine revelation or other means should be judged with a reason. However, there is no evidence on the traditional revelation as to whether it is divine original. This paper has widely looked at reason and faith and it is clear that the two are intricately intertwined.
Work Cited
Andrew Motte, Florian Cajori. “Sir Isaac Newton, Mathematical Principals of Natural Philosophy”. 1962.
Francois-Marie De Voltaire. “ On Bacon and Newton. 1733
Francois-Marie De Voltaire. “On Mr Locke”. 1733
Francis Bacon. “The Great Instauration”. 1733
Jeane Le Rond D Alembert. “The Human Mind Emerged from Barbarism. 1760.
John Locke. “Essay concerning Human Understanding”. Journal. 1677.
John Toland. “Christianity Not Mysterious: or, a Treatise Shewing that There is nothing in the Gospel Contrary to Reason, Nor Above It: And that no Christian Doctrine can be properly call’d A Mystery”. London, 1696.