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Market Structures
 
 
Introduction
Economists group industries into four distinct market structures: pure competition, pure monopoly, monopolistic competition, and oligopoly (McConnell & Brue 2004). Understanding the different market structures will help to understand how price and output are determined and will also help to evaluate the efficiency or inefficiency of those markets (McConnell & Brue 2004). This paper will briefly explain each market structure and will also explain how Quasar Computers evolved through each structure.
Monopolistic Competition
Monopolistic competition is defined as “a market structure in which several or many sellers each produce similar, but slightly differentiated products, each producer can set its price and quantity without affecting the marketplace as a whole” (InvestorWords, 2008). Quasar Computers is under intense competition within the computer industry. The company pioneered an optical notebook computer; new competitors have entered the market making optical technology easily available. Quasar planned ahead and set aside $200 million to develop their brand and keep their product differentiated. By thinking ahead and being proactive Quasar proved that they were ready for the monopolistic competition.
Oligopoly
Quasar Commuters has evolved into an oligopoly market because the patent on the optical technology expired. “Oligopoly involves only a few sellers of a standardized or differentiated product; so each firm is affected by the decisions of its rivals…” (Brue, McConnell, 2004). Orion Technologies has entered the optical notebook market. Quasar must effectively price and advertise their product in order to gain additional market share from Orion. Orion competitively lowers their product price to beat the price of Quasar, causing Q ...
 
 
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Avon Case Study

Executive Summary : Avon Products, Inc. (Avon) is based in New York. The firm engages in the manufacture and marketing of beauty and complimentary products primarily in North America, Latin America, Europe, and Asia Pacific (Yahoo Finance, 2005). Avon's products are classified into three product categories: Beauty, Beauty Plus, and Beyond Beauty. The Beauty category consists of cosmetics, fragrances, skin care, and toiletries; Beauty Plus includes fashion jewelry, watches, apparel, and accessories; and Beyond Beauty comprises home products, gift and decorative products, candles, and toys (Ibid). The company sells and markets its products through a combination of direct selling, marketing by independent Avon representatives, and via its consumer Web site, avon.com.
This paper will explore how the company is fairing under the leadership of its current CEO, Andrea Jung. There are two opposing views regarding the company's current and future success. One group feels that the firm has a promising future with Jung at the helm while the other group does not. This paper will analyze the pros and cons uncovered by each team member and discuss which view prevailed in the debate and why.
Pros of Jung and Avon : Andrea Jung became president and CEO of Avon in 1999 and has totally revamped the company. Under her leadership, the company has updated its product line, launched new advertising, and created a new image (Fact Monster, 2005). Avon's sales have increased by 30 %, profits 40%, and the stock price has dramatically improved (Ibid). Jung's has been able to align the firm's core capabilities with its strategic targets which has lead to phenomenal results. It appears that Jung has been able to establish a clear vision for the firm that has been inc ...

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