The behaviour of firms in an oligopoly - The Australian Automobile Industry

The Australian car industry is effloreticuloendothelial systemcely an example of an oligopoly. The broad four, Holden, Toyota, Ford and Mitsubishi dominate the industry. Collectively they sell 62% of new cars in Australia. These four steadfasts all have a mixing of local anestheticly produced and imported models, local proceedsion is however unspoken protected with the use of import tariffs, taxes, and quotas. Below is a tabularise showing the merchandise sh be that each manufacturer has. Oligopolies clear take many forms, they can range from being local to global. An example of a local oligopoly is a small res publica town with only two petrol stations. An oligopoly is essentially a market dominated by a couple of(prenominal) sellers. In a global sense these ar industries uniform steel, cars, oil, and eat cereals. Because in that location are few firms, each firm must all overturn how their policies are going to effect their competitors be haviour. In well-nigh oligopoly industries at that place is a homogeneous product for example steel, oil, etc. In separates, the product is differentiated crosswise producers for example cars and electronic goods. Where the products are homogeneous, there is greater interdependency among the firms in the industry. In these markets, a small change in price will manoeuvre customers to and from the rivals. In markets where the products are differentiated, producers are not quite as sensitive to each others actions. Oligopolies have emerged cod to a number of factors. This market structure can very much be traced to some form of barrier to launching like economies of scale, legal restrictions, differentiate name and brand loyalty or control over an essential resource. These barriers of entry can be thought of as similar but less stern than those of a monopoly. Economies of descale This is perhaps the most significant barrier for entry into an oligopoly. If the stripped efficient scale in an indu! stry is a reasonably large size, then only a few firms are needed to produce the output demanded by the market. For the US car industry, it has been...If you want to get a full essay, company it on our website: OrderCustomPaper.com

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