Lets talk about market structures and business organizations, and how a partnership can be a oligopoly.
By: Michael Caldwell How could a partnership be an oligopoly?
What are business organizations?
There is four market structures such as, pure competition, monopolistic competition, oligopoly and pure monopoly.
A business organization is an entity aimed at carrying on commercial enterprise by providing goods or services, to meet needs of the customers.
What are the advantages of a partnership?
Partnerships are easy to establish and have the ability to raise capital and the owner has the burden of making all business decisions.
Do you know what the disadvantages are of a partnership?
Yes! They have unlimited liability and have potential for conflict, and lack or permanence.
What is an oligopoly?
Oligopoly describes a market dominated by a few large, profitable firms. Acting on their own or as a team the biggest firms in an oligopoly may well set prices higher and output lower then in a purely competitive market.
Oligopoly firms set prices to maximize their own profit. It lends to partnerships and collaborations that foster success for themselves and other firms, specifically smaller companies operating within the same market or industry.
If one firm in a market lowers their prices on goods and services, attaining optimal sales growth, firms and direct competition usually follow suit, often creating a price war.