Analysis of University as Oligopolist Market Structure

1301 WordsJun 3, 20136 Pages
Claudious Kasere U104N0996 Intermediate economics assignment Spring semester 2013 Choose a business sector in which the company of your choice, operates and to analyze its market structure. Company I have decided to analyze is University of Nicosia and it operates in the oligopoly market structure. Oligopoly market is characterized by the production of homogenous commodities namely bachelor degrees, diplomas, masters and professional certifications ( ACCA,CMA AND CFA) and characterized by supernormal profits. The University of Nicosia could be classified as an oligopolistic. It is oligopolistic as it competing in a market where there are a small number of suppliers or service providers and many consumers. An oligopoly is a business environment where just a few players have great influence but not control over the market. This usually occurs when just a few companies sell very similar or identical products in the marketplace The market can be segmented into groups of producers and market is segmented into private, public, international students and EU students. Whereby there’s no difference in product but just category one fits into. By means of cluster analysis Regression analysis makes possible to derive cost functions for production of this commodity at every oligopoly firm and a uniform price function for all oligopolists. These functions enable to express the profit of every oligopolist in relationship not only on his output, but also on outputs of the other oligopolists. Determination of an optimal output for every oligopolist is equivalent with finding its equilibrium strategy in the game with the payoff function that represents its profit and with the strategy space that is limited by minimal and maximal output of the oligopolist. Under the assumption, that the price function

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