Market Structure simulation

East-West Transportation is in the freight transportation industry. The main way of transportation for East-West is by road and railroad. East-West?s railroad arm has everywhere 25,000 route miles across numerous states and also lasts in 3 Canadian provinces. There be 4 major transportation divisions for East-West, they consist of Consumer Goods, Chemicals, burn, and Forest products. Recently each of the divisions, which process in different securities industry structures, have experienced adept about losses and others have experienced take ins in spite of appearance the corresponding period of time. The Consumer Goods division sees within a sodding(a) competitor market structure. The division has recently experienced well-nigh losses in profit. The issue is that there are remote overly many competitors offering the same service, and there is no direct over prices. A decision had to be make in rules of order to cut down the amount of simoleons being at sea; the plant would either conclude down or come up to operate. The decision was make to continue operations but reduce the output to 6.75 one thousand million units. By reducing the output, it reduces the amount of profit lost to $ one hundred fifty million. Operating in a market where there are also many competitors offering the same service, produces an environs of over supply. The surplus is very limited to a corporation in general and even more so when the company?s profits are in jeopardy.

The Coal division of East-West operates in a monopolistic environment. East-West must fix on a price and output that will maximize profits. One would deem that in a monopolistic envi! ronment that any price can be set, on the contrary, when prices are set too high the company may effort the risk of subject a huge loss. In a monopoly the demand skip is downward sloping so the company must operate at an output where the marginal taxation equals marginal cost. East-West... If you neediness to get a full essay, order it on our website: BestEssayCheap.com

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