Posts Tagged ‘monopoly’

An Oligopoly is…

Thursday, June 30th, 2011

An oligopoly is a situation in which a small group of organizations dominates a particular market. The actions of these individual “oligopolists” affect one another and can collectively influence prices and production in the marketplace.

Oligopolies can exist both intentionally or unintentionally. For example, Apple and Dell computers dominate the market for laptops because they tend to sell more products than their competitors. But they’re not working together, so the dominance is unintentional. On the other hand, OPEC member countries have joined together and formed a cartel to intentionally dominate the oil market and keep prices high.

Anti-Trust Cops Anti-Nasdaq/NYSE Takeover

Tuesday, May 17th, 2011

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(photo credit: banspy)

What happens when the two largest stock exchanges in the U.S. become one big mega-exchange? A monopoly, that’s what! In case you don’t remember from history or economics class (or the game Monopoly), a monopoly is when one company controls an entire market, making it hard or impossible for smaller companies to fairly compete. (The market, in this case, being the market of stock markets.)

That’s why anti-trust regulators at the Justice Department have shut down Nasdaq’s attempted hostile takeover of the New York Stock Exchange. The takeover is hostile because the NYSE already has a deal with German bank Deutsche Borse to be acquired for $10 billion, and it’s so not interested in starting a relationship with Nasdaq right now.

The New York Stock Exchange and Nasdaq have been competing for years, which keeps them both in customer-pleasing, price-cutting mode. Without that competition, NYSEasdaq could charge whatever it wanted and still crush what little competition would be left.

It could even become… too big to fail!

Is Google a monopoly? Do you care?

Thursday, December 23rd, 2010

A monopoly is a company that has control over all sales and distribution of a product – to the extent that no other company can compete with it. For example, if your cable or utility companies are the only sellers of their service and you can’t really choose another company to buy from, they hold a monopoly on that particular service. Remember the game Monopoly? The goal was to own EVERYTHING.

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A Cartel is…

Wednesday, September 23rd, 2009

A cartel is a group of people or organizations in the same industry that work together to keep prices high so they can make more money. OPEC, for example, is an oil cartel. If any one of the member countries dropped their prices, people would flock to buy from that country, and the others would have to lower prices to compete. By all agreeing to keep their prices equally high, consumers don’t have a choice and all the members of the cartel make more profit.

A Monopoly is…

Friday, August 21st, 2009

A monopoly is a company that has control over all sales and distribution of a product – to the extent that no other company can compete with it. For example, if your cable or utility companies are the only sellers of their service and you can’t really choose another company to buy from, they hold a monopoly on that particular service. Remember the game Monopoly? The goal was to own EVERYTHING.

Antitrust Laws are…

Friday, August 21st, 2009

Antitrust laws are created to prevent companies from adopting certain business practices (like monopolizing an industry) that can restrict trade. These laws are in place to make businesses more competitive, which is better for the economy as a whole.