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Why do so many international markets tend towards oligopolist structure?
Definition of oligopoly - few and large firms with market power
a) Advantages of scale (LRAC diagram)
b) New markets - enhanced revenue/profits
c) spread of technology - firms will gain technological edge by merging or acquiring other firms
d) International firms will have access to foreign capital and lower cost factors of production
e) input from foreign markets can advantage the firm elsewhere, i.e. new tastes and preferences can permit the firm to transfer this knowledge to other markets
Assuming the Heckscher-Ohlin model is true. Suppose the Cuba and Russia sign a free trade agreement. Furthermore, assume the Cuba and Russia only produce cigars and vodka. Russia h
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Explain why a perfectly competitive firm does not expand its sales without limit if its horizontal demand curve indicates that it can sell as much as it desires at the current mark
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