Monopoly in Hong Kong Project

1385 Words6 Pages
Monopoly in Hong Kong Aims and Objective: The project aims to research the development of the monopoly in Hong Kong and the affections of the monopoly in Hong Kong. Even we will talk more about the influence of monopoly in our daily life deeply. Thus, we will select some examples from our daily life to analyze it that we can understand the circumstance of monopoly fully. For examples MTR, Power Company, etc. Our questions: 1.0What is monopoly? -an economic advantage held by one or more persons or companies deriving from the exclusive power -carry on a particular business or trade or to manufacture and sell a particular item, -suppressing competition and allow raising of the price of a product or service -price is higher than the price that would be established by a free market. 1.1Why does the Monopoly exist in our world? I. powerful forces exist both for the creation and maintenance of monopolies -natural human desire for wealth and power -profit making and provide their owners with financial, political and social power -Example:-government monopoly: oil exploration, railways II. Companies are acquiring control over a unique product that is difficult or cost heavily for other companies to copy. Example: pharmaceuticals Reason-expensive +risky to develop + protected by patents Result: kicking out a few large, well funded companies III. A lower production cost than competitors Explain-economies of scale ----> a greater efficiency, production cost per unit decreases when volume of output increases. IV. Some legal or illegal tactics - (a) buying Outor merge with competitors, - (b) Temporarily charging prices below cost , Aim: drive competitors out of business -© 1 taking control of suppliers required by competitors 2
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