Monopolies
(a) Along with your textbook reading, review the videos, blog, and articles below on market competition. Then respond to the following questions: If all the firms in an industry are charging the same price, is it fair to say that they are engaged in price collusion?
To what extent might this be a plausible explanation? Are there any other possible explanations? What type of market structure do you think is more conducive to firms engaging in price-fixing? Why do you think the price-fixing situation in the case described went on for so long? (one paragraph)
Click the following link to review a recent price-fixing case on bread: Russell, A. (2018). 7 Canadian companies committed indictable offences in bread-price fixing scandal: Competition Bureau
Global News.
(b) In your town or city try to find a local business that appears to enjoy some degree of monopoly power (it does not have to be a pure monopoly: one unique product and one seller). Briefly describe the nature of this business and explain some of the factors that give it monopoly power.
To what extent do you think the business is charging a fair price for what it offers? If you were to buy this business, what practical things would you do to strengthen your monopoly situation? (one paragraph)
