2. Sponge: Tuesday, February 14 Look at the demand curves on page 94 of the textbook. Explain how a market demand curve is composed of the demand of individuals. Could we have created individual demand curves from our class demand surveys?

3. Homework: Due Thursday, Feb. 16 1.Read pages 46 to 51 in your orange EOCT book and answer questions on pages 48, 51, and 52-54 –Write out the question and correct answer! 2.Complete supply/demand practice worksheet and graph seven of the scenarios

4. Homework: Due Thursday, Feb. 16 1.Read pages 46 to 51 in your orange EOCT book and answer questions on pages 48, 51, and 52-54 –Write out the question and correct answer! 2.Complete supply/demand practice worksheet and graph seven of the scenarios

5. SSEMI4 The student will explain the organization and role of business and analyze the four types of market structures in the U.S. economy. c. Identify the basic characteristics of (1) monopoly, (2) oligopoly, (3) monopolistic competition, and (4) pure competition.

6. Competition, Market Structures, and the Role of Government

7. Market Structures What is the primary aim/goal of businesses? To maximize profits What is competition? Striving against others to reach an objective

8. 4 Types of Market Structures 1.Pure/Perfect Competition involves a market with fair competition and no government or non-economic factors dictating price, supply or demand. 1.Large number of buyers and sellers 2.Identical product 3.Well informed buyers and sellers 4.No major barriers to entering market More CompetitionLess Competition

9. Pure/Perfect Competition Many buyer/sellers + Identical Products

10. Monopolistic Competition Meets all condition of perfect competition except for identical products. –Characterized by product differentiation Monopolistic competitors use non-price competition –Advertising, giveaways, or other promotions More CompetitionLess Competition

11. Monopolistic Competition Same as pure competition except for product differentiation Gap Levis Lucky

12. Monopolistic Competition Are these shampoos/conditioners different? Pantene $14.50Frederic Fekkai $54

13. Monopolistic Competition Are these mascaras different? Maybelline Sisley $4$43

14. Oligopoly A few very large sellers dominate the industry Oligopolists act interdependently by lowering prices soon after the first seller announces a price cut or offering new products after another firm does –E.g., car companies all offering 0% financing or introducing a similar model after a competitor does Collusion: formally agree to set prices Engage in price wars More CompetitionLess Competition

15. Oligopoly IpodZune

16. Oligopoly Few producers control supply and price

17. Coca-Cola Classic Coca-Cola classic Sprite Dasani Barq's Dannon Nestea Rockstar Evian Fanta Fresca Minute Maid Mr. Pibb Powerade Seagrams Ginger Ale & Mixers TAB

18. Pepsi-co Aquafina Pepsi Mountain Dew Sierra Mist Sobe Lipton Brisk Tea MUG Root Beer Slice Gatorade Dole Juice Tropicana

19. Cadbury Schweppes 7 Up Canada Dry Clamato Dr Pepper Hawaiian Punch Mott's Orangina Snapple

20. Toyota Scion Lexus

21. Chrysler Jeep Dodge

22. General Motors Chevrolet Buick Pontiac GMC Saturn Hummer SAAB Cadillac

23. Monopoly Only one seller of a particular product Few monopolies

24. Monopoly More CompetitionLess Competition One seller dominates the market with no close substitutes Barriers prevent other firms from entering market Monopoly is able to dictate price & output

25. Monopoly Natural Monopoly - efficient production by a single supplier

26. Monopoly Geographic Monopoly - small town or isolated location

27. Monopoly Technological Monopoly - new invention –Patent: exclusive right for 17 years Segway

28. Monopoly Technological Monopoly - new invention –Copyright: lifetime + 50 years This telecast is copyrighted by the NFL for the private use of our audience. Any other use of this telecast or of any pictures, descriptions, or accounts of the game without the NFL’s consent, is prohibited.

29. Monopoly Government Monopoly - government owned businesses

30. SSEMI4 The student will explain the organization and role of business and analyze the four types of market structures in the U.S. economy. a. Compare and contrast three forms of business organization—sole proprietorship, partnership, and corporation.

31. Sole Proprietorships Sole proprietorships are easy to start, but owners have unlimited liability. Sole proprietorships are businesses owned and run by a single person who has the rights to all profits and unlimited liability for all debts of the firm The most common form of business organization in the U.S. is the sole proprietorship or proprietorship.sole proprietorshipproprietorship

32. Sole Proprietorship-Advantages – The easiest form of business to start— few requirements – Decisions do not require approval from “higher ups.” – Keep all profits – Does not pay separate business income taxes; business is not a separate entity –Easy to get out of business –Psychological factor of being own boss

33. Sole Proprietorship-Disadvantages – Difficult to raise capital – Size and efficiency – Owner has unlimited liability.unlimited liability – May hire several employees to stay open – Cost of carrying minimum inventoryinventory – Often has limited managerial skills – Larger employers can offer more fringe benefits. – Limited life of business Limited life –Difficult to attract qualified employees Business owner is personally and fully responsible for all losses and debts of the business situation in which a firm ceases to exist when an owner dies, quits, or sells the business

34. Partnerships Unincorporated business owned and operated by two or more people who share the profits and responsibility for debts In a partnership, each partner fully shares responsibility for the operation of the business and all profits or losses. Partnerships are the least numerous form of business organization in the United States. A partnership has many of the same advantages and disadvantages of a sole proprietor.partnership

35. Partnerships—Two Types – General partnership: form of partnership where all partners are equally responsible for management and debts General partnership – Limited partnership: form of partnership where one or more partners are not active in the daily running of the business and have limited responsibility for debts Limited partnership

36. Partnerships--Advantages – Ease of startup – Formal legal papers called articles of partnership are usually written. – Ease of management/varied expertise – Lack of special taxes – Easier to attract capital than a proprietorship – Easier to find good employees than a proprietorship – More efficient operations that come with increased size

37. Partnerships--Disadvantages – In a general partnership, each partner is responsible for acts of all partners. – In a limited partnership, limited partner loses original investment. General partners must make up the rest of the loss. – Limited life – Potential for conflict between partners

38. Corporations Corporations are one of the most important forms of business and can easily raise large amounts of financial capital. A corporation is a formal, legal entity all its own.corporation Individuals who wish to incorporate must file with the national government and state where the business will have its headquarters.

39. Corporations-Advantages Ease of raising capital—sell more stock or issue bondsbonds The amount of money borrowed on a bond is called the principal.principal Corporations pay interest on this borrowed money.interest

40. Corporations-Advantages – Owners have limited liability – Directors can hire professional managers to run daily operations. – Unlimited life – Ease of transferring ownership

41. Corporations-Disadvantages – Detailed records need to be kept for payment of taxes. – Double taxation of corporate profits Double taxation – Difficulty and expense to get a corporate charter

42. Corporations-Disadvantages Owners or shareholders have little voice in business operations. Subject to more government regulations –Publicly held corporations must register with the federal Securities and Exchange Commission, established in 1934, to regulate the sale of stock.

43. Homework: Due Thursday, Feb. 16 1.Read pages 46 to 51 in your orange EOCT book and answer questions on pages 48, 51, and 52-54 –Write out the question and correct answer! 2.Complete supply/demand practice worksheet and graph seven of the scenarios

44. Work Period: Tuesday, February 14 Create a tree map comparing the four markets that we studied today. Your map should include the following for each market: 1.Number of firms 2.Barriers to entry 3.Products 4.Competition Create a Frayer model vocabulary for four of the words under micro section of your personal word wall