1. NS4960 Spring Term 2018 Approaches to OPEC Pricing

2. Spectrum of Competition

3. Aspects of Competition

4. Business Motives Firms can pursue a diverse set of motives.
Profit Maximization
Goal assumed by most theories – incremental revenues equal incremental costs
Sales Volume Maximization
Firm produces where total revenue equals total cost
Market Share
Common in oligopolies
Survival
Often found in highly competitive markets
Shareholder value
Equals remaining value of business after all debts paid
Satisficing
Attempting to take account number of objectives without maximizing any particular one

5. Monopoly: Cost and Revenue

6. Monopoly Optimization

7. Oligopoly Game Theory

8. Constant Sum Game: Minimize Losses

9. Problem of Potential Entry

10. Dominant Firm Model

11. Sales Maximization Model