1. Is there enough competition?
Risk of Oligopolies
Is there enough competition?

2. End Result of Oligopolies
Prices higher than perfect competition but less than monopoly
Economic profit > 0
Less than monopoly, more than perfect competition
Economies of scale in technology means there are rewards to be “bigger” in many markets

3. Oligopoly Market Risks
Predatory Pricing
Price Fixing

4. Predatory Pricing
Predatory Pricing is purposely setting your prices very low in order to put other firms out of business
Your intent is to raise prices later
This is illegal according to Anti-Trust Laws

5. Price Fixing
Price fixing is using collusion among competitors to fix prices
If firms cooperate prices rise toward monopoly prices
This is illegal according to Anti-Trust Laws

6. Price Fixing: MasterCard & Visa

7. Airline Price Fixing

8. Price Fixing: England: Milk & Cheese

9. Ben Bernanke Acts
Problems Challenges/Risks
Fed. Action

10. Lessons from the Great Depression
Bread Lines in USA