Potato Chip Industry Essay Example | Topics and Well Written Essays - 1250 words

Potato Chip Industry - Essay ExampleOften, there are barriers to the entry of bran-new competitors, specifically tater flake products. The barriers include government laws that ensure one entitys sole status in the current market segment. Often, the government offers a franchise the entity the right to exclusively operate in a new market economy (Miller, 2012, p. 533). There are several advantages in the 2008 potato chip monopoly environment. Wongs, the exclusive manufacturer of Wong potato chip products in the Northwest, has no competitors. Since there are no competitors, the seller, including Wonks, brook dictate the price of the products. Wonks can price its products at ten percent above cost. Wonks can also increase its current potato chip products prices by 20 percent. Wonks can raise its prices in pasture to allocate funds for research and development of new potato chip related products. The comp any can sell strawberry-flavored potato chip products. The company can sell v anilla-coated products. Wongs can sell the potato chip products in different sizes to fit the customers budget. Virgile Chassagnon emphasized From the 1930s to present day, the industrial embellish has changed considerably. The modern firm has evolved in parallel with the rise of the competitor, globalization and monetaryization that began in the early 1980s (2011, p.35).Likewise, the current and future customers are at the mercy of the noncompetitive entities, like Wonks. The clients cannot search for competitors to sell the same quality product at lower prices. However, Mizan Rahmann (2011) proposed the government must promote perfect competition. Perfect competition has more(prenominal) benefits compared to the monopoly market environment. For the government to benefit from the monopoly, Doyle observed When governments intervene in markets truly open, competitive free markets do not exist. There are many examples of how competition is limited by the entry of new firms being blocked or in some way made more difficult (Doyle, 2005, p. 199). The government hitch can be the best alternative to prevent entry of prohibited competitors. The government can set a limit to the number of competitors in any local industry. In addition, Deanna Malatesta (2011) reiterated the government can institute laws that control the abuses. Malatesta observed the government counters the credible threats of opportunists, franchise violators, in the monopoly economy with more effective laws. Further, the Vaticans Pontifical Council for Justice and Peace councils call for the establishment of a world political authority that is vested with the power to control both global financial transactions and the worlds economic activities, especially controlling the outright abuses of the monopoly organizations unreasonably high prices. The councils call answered the United estate Prime Minister Tony Blairs assessment that the current disadvantageous turmoil of the current European Union economy threatened both the military readiness of the allies and their capacity to share humanitarian help to the poor and neglected members of the global society (Justice & Economics, 2011). The government benefits from monitoring and controlling only one potato industry entity, Wonks, by spending less monitoring time and costs. However, some other businesses will not benefit from the