Economics Section Business Economics Further Reading c 26

Economics Section: Business Economics Further Reading c 26 Keywords – Oligopoly, Interdependence, cartel, collusion, niche, price war • Class : y 10 • Lesson Topic: Oligopoly • Scheme of Work: Business Economics

Economics Section: Business Economics Further Reading c 26 Keywords – Oligopoly, Interdependence, cartel, collusion, niche, price war

Economics Section: Business Economics Further Reading c 26 Keywords – Oligopoly, Interdependence, cartel, collusion, niche, price war P&D Lesson Objectives Planning and Data ALL (KNOWLEDGE) Define and describe the terms of oligopoly MOST (ANALYSIS) Examine and Analyse the concepts of oligopoly SOME (EVALUATION ) Higher thinking Skills Evaluate the pros and cons & Justify your views of oligopoly

Economics Section: Business Economics Further Reading c 26 Keywords – Oligopoly, Interdependence, cartel, collusion, niche, price war P&D Planning and Data Planning Tools

Economics Section: Business Economics Further Reading c 26 Keywords – Oligopoly, Interdependence, cartel, collusion, niche, price war Personalise your learning. . . Define and describe the terms of oligopoly [Grade E-D] Examine and Analyse the concepts of oligopoly [Grade C-B] Evaluate the pros and cons & Justify your views of oligopoly [Grade A-A*]

Economics Section: Business Economics Further Reading c 26 Keywords – Oligopoly, Interdependence, cartel, collusion, niche, price war Keyword Definition Oligopoly Cartel Collusion Interdependence Price War Niche CONNECTIVES

Economics Section: Business Economics Further Reading c 26 Keywords – Oligopoly, Interdependence, cartel, collusion, niche, price war CONTRASTING Although… Except… Moreover… If… However… Yet… Apart from… Unless… Despite… As long as… CAUSE & EFFECT Consequently… Due to… As a result… Therefore. . Because of… Because… CONCLUDING Firstly… After… Secondly… Before… Overall… I believe… Finally… I think … In conclusion… it depends… To conclude… short term… Meanwhile… Long term… COMPARING Equally… As with… Like… In the same way… Similarly… Even so… Likewise… CONNECTIVES for Analysis CONNECTIVES for Application CONNECTIVES for Evaluation EMPHASISING Most importantly… Significantly… Notably… Especially… Above all… In particular… Indeed… QUALIFYING Despite… Yet… As long as… Unless… Apart from… If… Moreover… Except… However… Although… ADDING In addition… And… Too… Also… Additionally… As well as… Furthermore… ILLUSTRATING For instance… Such as… In the case of… So… For example… As revealed by… As illustrated by…

Economics Section: Business Economics Further Reading c 26 Keywords – Oligopoly, Interdependence, cartel, collusion, niche, price war ATD A-A* 1. To what extent 2. Do you think 3. Evaluate whether (8 -10 m) 10+ connectives & key words C-B Climb the Ladder 1. Explain 2. Compare 3. Analyse (5 -8 m) 5+ connectives & key words E-D Apply to demonstrate 1. Define 2. Describe 3. Identify (2 -4 m) 2 + connectives & key words

Economics Section: Business Economics Further Reading c 26 Keywords – Oligopoly, Interdependence, cartel, collusion, niche, price war List as many firms as you can in the market • Car industry • Sports brands • Gulf Airlines • Fast food restaurants

Economics Section: Business Economics Further Reading c 26 Keywords – Oligopoly, Interdependence, cartel, collusion, niche, price war Is there a trend for about 5 dominant firms?

Economics Section: Business Economics Further Reading c 26 Keywords – Oligopoly, Interdependence, cartel, collusion, niche, price war What this oligopoly • We’ve looked at competitive market and monopoly. • The reality for many big firms is somewhere in between. • Oligopoly firms face competition but have SOME market power. • Typically this market has 4 -5 firms who dominate sales.

Economics Section: Business Economics Further Reading c 26 Keywords – Oligopoly, Interdependence, cartel, collusion, niche, price war Pure Monopoly Perfect Competition Monopolistic Competition Oligopoly Duopoly Monopoly The further right on the scale, the greater the degree of monopoly power exercised by the firm. Lots of Competition Competitive Prices No Competition High Prices

Economics Section: Business Economics Further Reading c 26 Keywords – Oligopoly, Interdependence, cartel, collusion, niche, price war Can you think of a market where 4 -5 firms dominate?

Economics Section: Business Economics Further Reading c 26 Keywords – Oligopoly, Interdependence, cartel, collusion, niche, price war Tertiary Sector Secondary Sector Primary Sector How do firms grow? Integration

Economics Section: Business Economics Further Reading c 26 Keywords – Oligopoly, Interdependence, cartel, collusion, niche, price war Oligopoly is a market dominated by a few large producers of similar products. – Examples: tires, beer, cigarettes, copper, greeting cards, steel, aluminum, automobiles and breakfast cereals

Economics Section: Business Economics Further Reading c 26 Keywords – Oligopoly, Interdependence, cartel, collusion, niche, price war How do Oligopolies form? Barriers to Entry • Legal Barriers – Patents • Costs Barriers – Economies of Scale • Marketing Barriers – Economy of Scale Same as Monopolies

Economics Section: Business Economics Further Reading c 26 Keywords – Oligopoly, Interdependence, cartel, collusion, niche, price war Characteristics of Oligopoly • Interdependence – Self-interested behavior that takes into account what other firms do. • Therefore firms collude and agree on prices, rather than compete. • One form of collusion is the cartel: a formal agreement among producers to set the price and output to increase everyone’s profit.

Economics Section: Business Economics Further Reading c 26 Keywords – Oligopoly, Interdependence, cartel, collusion, niche, price war

Economics Section: Business Economics Further Reading c 26 Keywords – Oligopoly, Interdependence, cartel, collusion, niche, price war

Economics Section: Business Economics Further Reading c 26 Keywords – Oligopoly, Interdependence, cartel, collusion, niche, price war What they mean for consumers • Rigid, possibly higher prices. • Lack of genuine price competition • High quality products as firms want brand loyalty, therefore lots of marketing. i. e. Non- Price Competition • Sometimes firms agreements collapse and a PRICE WAR starts, where firms compete aggressively to win consumers. i. e. Price Competition. Consumer wins!

Economics Section: Business Economics Further Reading c 26 Keywords – Oligopoly, Interdependence, cartel, collusion, niche, price war What they mean for the oligopoly firm • Can take advantage of economies of scale – Low cost per unit. • Massive marketing spending to convince customers to pay higher prices. Non – price competition. • Massive marketing budgets also act as barriers to stop new firms entering. • Can charge what they want – High Profits!

Economics Section: Business Economics Further Reading c 26 Keywords – Oligopoly, Interdependence, cartel, collusion, niche, price war What they mean for the society • Oligopoly market will have price stability as firms agree on prices. • Governments may have to intervene if a cartel limits competition and prices rise too much. • There is a reasonable amount of choice for consumers, unlike monopoly where there is no choice.

Economics Section: Business Economics Further Reading c 26 Keywords – Oligopoly, Interdependence, cartel, collusion, niche, price war Supermarket Competition or collusion? • Price War? • Supposed ‘Price War’ consumers actually paid more. • No formal agreement, rather a ‘fake’ attempt at competition but all firms seeking higher prices for higher profit. • But, sometimes! Real Price Wars!

Economics Section: Business Economics Further Reading c 26 Keywords – Oligopoly, Interdependence, cartel, collusion, niche, price war

Economics Section: Business Economics Further Reading c 26 Keywords – Oligopoly, Interdependence, cartel, collusion, niche, price war Oligopoly Pros and Cons Advantages Disadvantages

Economics Section: Business Economics Further Reading c 26 Keywords – Oligopoly, Interdependence, cartel, collusion, niche, price war PLENARIES

Economics Section: Business Economics Further Reading c 26 Keywords – Oligopoly, Interdependence, cartel, collusion, niche, price war ATD A-A* 1. To what extent 2. Do you think 3. Evaluate whether (8 -10 m) 10+ connectives & key words C-B Climb the Ladder 1. Explain 2. Compare 3. Analyse (5 -8 m) 5+ connectives & key words E-D Apply to demonstrate 1. Define 2. Describe 3. Identify (2 -4 m) 2 + connectives & key words

Economics Section: Business Economics Further Reading c 26 Keywords – Oligopoly, Interdependence, cartel, collusion, niche, price war P&D Lesson Objectives Planning and Data ALL (KNOWLEDGE) Define and describe the terms of oligopoly MOST (ANALYSIS) Examine and Analyse the concepts of oligopoly SOME (EVALUATION ) Higher thinking Skills Evaluate the pros and cons & Justify your views of oligopoly

Economics Section: Business Economics Further Reading c 26 Keywords – Oligopoly, Interdependence, cartel, collusion, niche, price war R Review the Learning Pass the Parcel Add as much information you can remember from today’s lesson When the horn blows – pass your sheet to the next table!

Economics Section: Business Economics Further Reading c 26 Keywords – Oligopoly, Interdependence, cartel, collusion, niche, price war R Review the Learning 2 things your neighbour has learnt today Neighbours 1 question your neighbour wants to ask

Economics Section: Business Economics Further Reading c 26 Keywords – Oligopoly, Interdependence, cartel, collusion, niche, price war R Review the Learning Tweet Summarise your learning today into a single tweet 140 characters Keep all of the information STOP

Economics Section: Business Economics Further Reading c 26 R Keywords – Oligopoly, Interdependence, cartel, collusion, niche, price war Review the Learning 1 question you need to ask 2 new things you learnt 3 pieces of information

Economics Section: Business Economics Further Reading c 26 Keywords – Oligopoly, Interdependence, cartel, collusion, niche, price war 5 minutes. . . GO STOP