ASSESSMENT 2 Essay Example | Topics and Well Written Essays - 2500 words

ASSESSMENT 2 - Essay Example This demonstrates the interdependence that exists between the managerial decisions made by the two firms and this affects the pricing and output in the market. Monopolistic market structure is characterized by the presence of multiple of firms that sell similar but non-identical products to equally informed consumers. Consumers are thus presented with an opportunity of picking either product from any of the consumers, as they are substitutes of each other and thus serve the same purpose. Edward Chamberlin and Joan Robinson first described the monopolistic market structures in the 1930s and generated the characteristics of such a market. Duopoly and monopolistic market structures differ significantly in the number of producers, type of goods and the government influence that is exerted in each situation. This paper seeks to highlight the differences between the two market structures and this affects the performances of the firms involved. The paper also seeks to provide a case study of firms in the united states that operate under the two different market structures and how their success and failure has been influenced by this market struct ure (Weron and Weron, 438). The first obvious characteristic of duopoly market is the presence of only two firms, sellers or produces whose actions or lack of it affects the managerial decisions of the other. For long, a number of firms in the United States have operated under a duopoly market structure but has since changed due innovation and technological advancement. Pepsi and Coca-Cola are the major soft drink manufacturers in the United States and they literally control the market and its dynamics. Visa and MasterCard have also remained as the major plastic money providers not just in the United States but also in major economies around the world (Weron and Weron, 439). In a duopoly market structure, the decisions made by one of