1. Unit 3: Competition & Business
Ch 22.1, 22.3, 23.2
Essential Standard CE.E.1.5

2. Competition
Competition will exist if different businesses produce similar products

3. Monopoly: A sole provider of a good or service controls the market.
No substitutes; no competition
Suppliers can raise prices without losing business.

4. Competition is GOOD! Lower Prices Better Quality
More choices for consumers
Capitalism shows gov’t support of competition

5. Advertisements
Used by businesses to inform people about their goods and services
Cheapest and most effective form is by word of mouth

6. Discussion Question
What are the characteristics of an effective advertisement?
Think of advertisements that make you want to buy the product. What about that ad is convincing?
Super Bowl 2013 Commercial costs $3.8 million for 30 seconds (that’s $126,667 per second)

7. Ad Slogan Contest

8. Mergers: One company joins with another to make one business
Horizontal: Companies in the same business.
Cell Phone Company + Cell Phone Company

9. Mergers continued… 2. Vertical: Company joins with one it buys from
Lumber company + Construction company

10. Mergers continued… 3. Conglomerate: buying of unrelated businesses
Nabisco + RJ Reynolds