1) Please compare and contrast the monopolistically competitive firm's demand curve to those of a perfect competitor and a monopolist.

2.    Please list four goods or services that you have purchased that were produced by an oligopolist. Why are these industries oligopolistic, rather than monopolistically competitive? Explain the rationale behind your idea.

3.    Do you think the mutual interdependence is important under oligopoly, but not so important under perfect competition, monopoly, or monopolistic competition? If so, why? Please explain the rationale behind your discussion.

1.

The demand for products is higher in monopoly firms while its low in perfect competition

The prices in the monopolistic firms is higher while the prices in the perfect competition are fairly averaged

The profit maximizing output in monopolistic firm is when the marginal revenue is equal to the marginal cost while in perfect competition, the quantity at maximized revenue is when the marginal revenues equals the price

2

Motorbike

Aluminum kitchen materials

Cement

Coke cola soft drink

They are oligopolistic rather than monopolistic since there are a few number of firms and not one firm.

They are oligopolistic because there are close substitutes to the products

3

Mutual interdependence is important to the oligopoly and not any other market segment because the firms in the oligopoly structure are few but large hence have control over the prices and the product to be produced.

Step-by-step explanation

1.

The demand for products is higher in monopoly firms this is because they are the only suppliers in the market hence the buyers have the only option of buying from them while there is low demand in perfect competition since the firms are numerous in the economy hence customers have a wide variety.

The prices in the monopolistic firms is higher this is because the frim remains to be the own price setter and there is no competition from any other firm in the economy while the prices in the perfect competition are fairly averaged since the customers have a complete knowledge of the market

The profit maximizing output in monopolistic firm is when the marginal revenue is equal to the marginal cost while in perfect competition, the quantity at maximized revenue is when the marginal revenues equals the price

2

Motorbike

Aluminum kitchen materials

Cement

Coke cola soft drink

They are oligopolistic rather than monopolistic since there are a few number of firms and not one firm, in a monopoly structure we only have one firm operating, a product like cement in Kenya are few not only one type.

They are oligopolistic because there are close substitutes to the products such as the soft drinks but a product in the monopoly sector lacks any close substitute

3.

The firms in the oligopoly structure are few but large hence have control over the prices and the product to be produced hence a little change in price by one firm majorly affects the other rivals in the economy. In perfect competition t firms are numerous hence have very little control over the market price and the product. Monopoly, there is only one fir hence it has the control over the prices