Sole Proprietorships Sole proprietorship A business owned and
Sole Proprietorships • Sole proprietorship: A business owned and run by one person • Easy to start • Just need to pay business licenses and fees • Ex: Opening up your own restaurant
Partnerships • Partnership: A business jointly owned by two or more persons • Types of partnerships • General partnership • Limited partnership • Easy to start • Partners decide how to divide losses and profits
Corporations • Corporation: A business organization recognized by law as a separate entity having the rights of an individual • To form a corporation: • Government Charter • Stocks • Investors
Horizontal Mergers • Two or more businesses that produce the same kind of product join together
Vertical Mergers • When businesses involved in different steps of manufacturing or marketing join together
Conglomerates • A business that has at least four businesses all making different products
Multinational • A corporation that has manufacturing or service operations in a number of different countries
Perfect Competition Many sellers Easy to enter and exit the market Everyone is wellinformed Identical products Price set by supply and demand
Monopolistic Competition Easy to enter or exit the market Limited control over price Product Differentiation Nonprice competition Advertising
Oligopoly A few very large sellers Difficult to enter the market Differentiated products Price maker Use collusions and price-fixing Some advertising
Monopoly Only ONE SELLER of a particular product No close substitutes Sets its own market prices Almost impossible to enter the market
Natural Monopoly Occurs when it would be too costly, difficult, etc. to have another business offering G&S in that area 13
Geographic Monopoly Occurs when it's the only business selling that G&S in town 14
Technological Monopoly Occurs due to patents or copyrights 15
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