Beyond the Sound Bites (if time after the Test):
Skip #16 and #35; do not answer on the Test.
The Chapter 4 Test Make-up is today.
Cf. http://shanawiki.wikispaces.com/Honors+Business+Economics+Chapter+4+Test+Prep+Page+Spring+2011
The Ch. 4 Sec. 3 Quiz Make-up is today.
EPA chief Lisa Jackson appearing before the House Energy and Commerce Committee and John Shimkus (IL-R).
Cf. http://gulagbound.com/12430/video-epa-chief-jackson-lectured-about-america-by-house-energy-committee
What will happen to the cost of electricity? And, who will pay the price?
Standard feature:
The electronic edition of the Philadelphia Inquirer is available. We have the Sunday edition, available on Mondays, in addition to the Tuesday through Friday editions on the other days.
Please follow the steps below:
URL: http://nie.philly.com
Click on the words "Access e-Inquirer" located on the gray toolbar underneath the green locker on the opening page.
Login:
Username: bshsinky@shanahan.org
Password: 10888
Chapter 7
Cf. http://glencoe.mcgraw-hill.com/sites/0078747643/student_view0/unit2/chapter7/
Chapter 7: Market Structures
Overview
Section 1: Competition and Market Structures
Market structure is the nature and degree of competition among firms doing business in the same industry. Competitive markets represent an ideal situation not always found in the economy. The idea of perfect competition is based on large numbers of buyers and sellers, identical products, independent action by market participants, reasonably good information about market conditions, and the freedom to enter or leave the market. Imperfect competition occurs when any of the conditions for perfect competition are not met. There are three forms of imperfect competition: monopolistic competition, which has all the characteristics of perfect competition except for product differentiation; oligopoly, which is a market structure dominated by a few very large firms; and monopoly, which is a single producer with the most control over supply and price. All profit-maximizing firms, regardless of their market structure, maximize profits by equating the marginal cost of production with the marginal revenue from sales.
Student Web Activity
"Department of Justice - Antitrust Enforcement"
Introduction
Today, government has the power to encourage competition and to regulate certain monopolies that exist for the public welfare. In some cases, government has taken over certain economic activities and runs them as government-owned monopolies. The United States Department of Justice Antitrust Division works to promote and protect fair business practices through the enforcement of antitrust laws. In this activity, you will learn more about the Antitrust Division.
Cf. http://www.justice.gov/atr/
Why It Matters
The Big Ideas
Guide to Reading
Section Preview
Content Vocabulary
laissez-faire
Which Government is the Most Laissez-Faire? 2:56
Peter Schwartz, former chairman of the board of directors of the Ayn Rand Institute, is asked if any government, past or present, comes close to his idea of laissez-faire capitalism.
In-class assignment, with a partner, answer the following questions.
Is there any government, past or present, that comes close to the idea of laissez-faire capitalism?
What nation was founded on individual rights?
In spirit, does the U.S. retain these ideas?
Will a nation founded on individual rights happen anywhere else?
market structure
Market Structures, 5:52
In-class assignment, with a partner, answer the following questions.
What will differ based on the market structure?
What is the continuum of Market Structures? (begin to draw the continuuum from left to right)
How do I recognize a perfectly competitive market?
How do you define market power?
What would happen if you tried to raise your price?
What characterizes a monopoly?
What are barriers to entry?
Are there other structures?
What are two more structures?
What characterizes Monopolistic Competition?
What characterizes Oligopoly?
What is mutual interdependence?
What product or products fit each?
perfect competition
Perfect Competition, 7:13
In-class assignment, with a partner, answer the following questions.
How would you recognize a perfectly competitive industry?
Do they have power to control price?
If the individual firm can not set the price, then where does the price come from?
What happens if they lower their price?
Is there anything you do have control over?
What is the formula for maximizing profit?
What about marginal costs?
Why are profits in the short run?
What is the effect of sharks entering the competition?
In the long run, how much does a perfectly competitive firm's profits equal?
imperfect competition
Animated diagram showing market failure due to imperfect competition, :30
monopolistic competition
product differentiation
nonprice competition
oligopoly
collusion
price-fixing
price fixing, 1:02
Price fixing defined and illustrated here by these three individuals.
(Conversation and Discussion: Business Readings, Duisburg-Essen University, winter term 2008-09)
Cf. http://www.youtube.com/watch?v=A0_UmU8BIkc
monopoly
natural monopoly
economies of scale
geographic monopoly
technological monopoly
government monopoly
Academic Vocabulary
Ch. 7 Sec. 1 Reading Strategy
In-class assignment, with a partner, complete the graphic organizer by identifying the characteristics of different market structures.
Profits, Prices Spur Oil Outrage
Perfect Competition
Necessary Condition
Profit Maximization
Figure 7.1 Perfect Competition and Profit Maximization, p. 171
Cf. http://glencoe.com/sites/common_assets/socialstudies/in_motion_08/epp/EPP_p171.swf
A Theoretical Situation
Imperfect Competition
Reading Check
Describing
Why does perfect competition serve as a theoretical market structure?
Careers
Market Researcher
Monopolistic Competition
Product Differentiation
Nonprice Competition
Profit Maximization
Reading Check
Comparing
How is profit maximization in a monopolistic firm different from that of a perfect competitor?
The Global Economy and You
Poco, Heart, and Wisdom
Oligopoly
Interdependent Behavior
Profit Maximization
Reading Check
Explaining
Why do oligopolists frequently appear to act together?
Monopoly
Types of Monopolies
Profit Maximization
Reading Check
Analyzing
Why do natural monopolies sometimes result in economies of scale?
Profiles in Economics
Bill Gates
In-class assignment, with a partner, summarize Perfect Competition and Profit Maximization based on the example.
Ch. 7 Sec. 1 Review
In-class assignment, with a partner, use the graphic organizer to identify the characteristics of imperfect competition.
Ch. 7 Sec. 2 Reading Strategy
In-class assignment, with a partner, complete the graphic organizer about why maintaining adequate competition is a worthwhile goal. Use the graphic organizer to list some of the effects of competition.
In-class assignment, with a partner, use the graphic organizer to identify and describe both types of externalities.
In-class assignment, with a partner, complete the graphic organizer by describing how governments try to avoid market failures.
In-class assignment, with a partner, use the graphic organizer to identify how the federal government can maintain competition and improve economic efficiency.
References
Ch. 4 Prep
Cf. http://glencoe.mcgraw-hill.com/sites/0078747643/student_view0/unit2/chapter4/
Multiple Choice Quiz
Cf. http://glencoe.mcgraw-hill.com/sites/0078747643/student_view0/unit2/chapter5/self-check_quizzes.html
Crossword Puzzle
Cf. http://www.glencoe.com/olc_games/game_engine/content/gln_ss/epp_08/ch05/index.html
Flashcard
Cf. http://www.glencoe.com/qe/efcsec.php?qi=15424
Ch. 5 Prep
Chapter 5 Supply Multiple Choice Quiz
Cf. http://glencoe.mcgraw-hill.com/sites/0078747643/student_view0/unit2/chapter5/self-check_quizzes.html
Chapter 5 Puzzle
Cf. http://www.glencoe.com/olc_games/game_engine/content/gln_ss/epp_08/ch05/index.html
Chapter 5 Supply Flashcards
Cf. http://www.glencoe.com/qe/efcsec.php?qi=15424
Ch. 6 Prep
Chapter 6: Prices and Decision Making
Multiple Choice Quiz
Cf. http://glencoe.mcgraw-hill.com/sites/0078747643/student_view0/unit2/chapter6/self-check_quizzes.html
ePuzzle Concentration
Cf. http://www.glencoe.com/olc_games/game_engine/content/gln_ss/epp_05/chapter06/index.html
Academic, Glossary, People/Places/Events
Cf. http://www.glencoe.com/qe/efcsec.php?qi=15429
Email (or hand in hard copy) to gmsmith@shanahan.org.
The Ch. 4 Sec. 3 Quiz Make-up is available to take.
Cf. http://shanawiki.wikispaces.com/Honors+Business+Economics+Chapter+4+Section+3+Quiz+Prep+Page
Cf. http://shanawiki.wikispaces.com/Honors+Business+Economics+Chapter+4+Test+Prep+Page+Spring+2011
Email (or hand in hard copy) to gmsmith@shanahan.org
Friday HW
1. p. 164, #7
