Monopolistic practices, Managerial Economics


The following practices may be said to characterize monopolies.

Exclusive dealing to supply and collective boycott

Producers agree to supply only to recognized dealers, normally only one dealer in each area, on condition that the dealer does not stock the products of any producer outside the group (or trade association).  Should the dealer break the agreement, all members of the group agree to withhold supplies from the offender.  This practice has proved a very effective restriction on competition for it ensures that any new firms would find it extremely difficult to secure market outlets for their products.


The creation of barriers to ensure that there is no competition against them.  E.g price undercutting, individual ensure that actual text printed collective boycott and exclusive holding of patent rights.

Resale Price Maintenance (PRM)

A monopolistic firm may dictate to wholesalers and retailers the price at which its products would be sold.  This is another way of ensuring that other firms are not attracted into the industry, if such firms can sell their products at more competitive prices.

Posted Date: 11/28/2012 5:19:37 AM | Location : United States

Related Discussions:- Monopolistic practices, Assignment Help, Ask Question on Monopolistic practices, Get Answer, Expert's Help, Monopolistic practices Discussions

Write discussion on Monopolistic practices
Your posts are moderated
Related Questions
Based on the information given in the Canada Health Act as well as the information given in your Study Guide, write a description of how medical services are funded in Canada. Be s

Leading Economic Indicators The 11 key economic indicators that have been establish to lead business cycle turning points. Of the 11, four are basically used in business;

what are the examples of the types of elasticity (price,income & cross elaticity

Organization for Economic Development (OECD) An international organization found in Paris France in 1961, to act as a worldwide forum to stimulate world trade and

Schumpeter Description According to Schumpeter, a cycle represents wave like deviations in business activity from the equilibrium or trend line. There are equilibrium points an

Price Elasticity at Terminal Points The price elasticity at terminal point N equals 0 means that at point N, e = 0. At terminal point M, although, price-elasticity is undefined

Barriers to entry in pure oligopoly The barriers to entry can be artificial or natural. Artificial Barriers This can be acquired through: State protection throu

WAGE DETERMINATION, POLICY AND THEORIES Wages and salaries are rewards to labour as a factor of production of goods and services.  In ordinary speech a distinction is frequent

Disadvantages of Perfect Competition There is a great deal of duplication of production and distribution facilities amongst firms and consequent waste. Economies of sc

Define the term understanding oligopoly. Understanding Oligopoly; One possibility when the two companies will engage into collusion, Sellers engage into collusion while t