Economics
4th Edition
ISBN: 9781464143847
Author: Paul Krugman, Robin Wells
Publisher: Worth Publishers
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Question
Chapter 12, Problem 1BCQ
To determine
Concept Introduction:
Expert Solution & Answer
Explanation of Solution
- In the given case, it can be seen that the retailers of the electronics market are not perfectly competitive.
- Before the mobile devices became popular, people bought goods if the salesperson could persuade the buyer in the correct manner and made him believe that the deal that is being given is the best he could get.
- However, after the mobile devices became popular, the buyers are now able to compare the prices of retailers with what is being offered online.
- The online sellers sold goods at cheaper rates and gave coupons to buyers, which made them attracted to buy goods online.
- Hence, the introduction of online apps in the shopping world has become a hurdle in the way of competition in markets.
Conclusion:
Thus, the electronics market is not perfectly competitive.
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