Pricing with Market Power Homework Help

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Eliminate Your Confusions by Obtaining Pricing with Market Power Homework Help

Economics is a very interesting academic discipline where you will come across a lot of really useful topics having practical applicability. One such topic is pricing with market power. It is an elaborate topic that covers theory, practical and diagrammatic explanations. If you are facing any confusion on this topic, then you should go for pricing with market power homework help as early as possible.

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What is pricing with market power?

Market power is the power of a business entity by which it can raise the market prices of the goods and services or can restrict the quantity for its goal of increasing the profitability. This situation is however not favorable for the consumers because they have to pay higher prices and may have access to just a restricted level of output.

If there is a single firm having the total market power,then it can raise the prices and still it won’t lose any of its customers.Those firms in the economy that have market power are also considered as the price makers, or you can say they set the prices.

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The different strategies

There can be different pricing strategies that a firm is having market power can adopt. There can be a case that such a firm may choose to charge the same price from all its customers. In such a situation it will see the maximum output it can produce and based on that it will decide its final price so that profits can be maximized.

However, there can be a case where the firm having market power can charge different prices from different customers for the same goods and services. Such a price strategy is actually to price discrimination. The firm with market power which is involved in such type of price discrimination will be able to earn an even much more economic profit as compared to a single price monopoly firm in the market.

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