DateDate: April 24, 2013: April 24, 2013

TopicTopic: Monopolistic: MonopolisticCompetitionCompetition

AimAim: How does monopolistic : How does monopolistic competition exist?competition exist?

Do NowDo Now: Multiple Choice : Multiple Choice Questions. Questions.

Beginning in the mid-1970’s Pepsi Cola launched a marketing campaign called the Pepsi Challenge. The challenge took the form of a taste test.

TODAY WE WILL TAKE THE PEPSI CHALLENGE!!TODAY WE WILL TAKE THE PEPSI CHALLENGE!!

Monopolistic Competition

Many companies compete in an open market to sell products that are similar but not identical.

Each firm holds a monopoly over its own particular product.

Four Conditions of Monopolistic Competition

Many firms.

Few artificial barriers to entry.

Slight control over price.

Differentiated Products.

Monopolistic Competition

Non-price CompetitionMonopolistic competition also takes the form of

non-price competition.Competition through ways other than lowering

prices.

I WILL FIGHT YOU IN WAYS OTHER THAN CHANGING MY PRICES!

NONPRICE COMPETITIONSTATION #1

PHYSICAL CHARACTERISTICS

THESE SNEAKERS LOOK BETTER AND ARE MUCH MORE COMFORTABLE, KIM!

NONPRICE COMPETITIONSTATION #2

LOCATION

FINALLY WATER! BUT WAIT A SECOND! THAT WATER MAY COST ME MY SPOTS!

WE’RE HITTIN THE OCEAN PALACE FOR OUR SONS COLLEGE GRADUATION DINNER!

NONPRICE COMPETITIONSTATION #3

SERVICE LEVEL

I CAN JUST SIT IN MY CAR AND THEY BRING ME FOOD!

THE SERVICE USED TO BE SO MUCH BETTER HERE!

NONPRICE COMPETITIONSTATION #4

ADVERTISING, IMAGE, AND STATUS

HEY, WHAT GREEN SHIRT DO YOU WANT TO BUY?

YO! THAT HILFIGER SHIRT IS MAD NICE. IT SAYS HILFIGER ON IT.

OligopolyMarket dominated

by a few large profitable firms.

Ex: airlines and gas companies.

Summary activity – Answer the Aim.

How does monopolistic How does monopolistic competition exist?competition exist?

YES, THIS WILL BE COLLECTED.