1. Date: April 13, 2011 Topic: Monopolistic Competition and Oligopoly Aim: Why does monopolistic competition exist? Do Now: Read the article.

2. Beginning in the mid-1970’s Pepsi Cola launched a marketing campaign called the Pepsi Challenge. The challenge took the form of a taste test. Beginning in the mid-1970’s Pepsi Cola launched a marketing campaign called the Pepsi Challenge. The challenge took the form of a taste test. TODAY WE WILL TAKE THE PEPSI CHALLENGE!! TODAY WE WILL TAKE THE PEPSI CHALLENGE!!

4. Monopolistic Competition Many companies compete in an open market to sell products that are similar but not identical. Many companies compete in an open market to sell products that are similar but not identical. Each firm holds a monopoly over its own particular product. Each firm holds a monopoly over its own particular product.

7. Four Conditions of Monopolistic Competition Many firms Many firms Few artificial barriers to entry Few artificial barriers to entry Slight control over price Slight control over price Differentiated Products Differentiated Products

8. Non-price Competition Competition through ways other than lowering prices. Competition through ways other than lowering prices. Can you think of examples? Can you think of examples? A.) Physical Characteristics. A.) Physical Characteristics. Ex: sneakers having different characteristics. Ex: sneakers having different characteristics. B.) Location. B.) Location. Ex: Water store in the middle of the Mojave. Ex: Water store in the middle of the Mojave. C.) Service Level. C.) Service Level. Ex: Sonic Drive In. Ex: Sonic Drive In.

9. Oligopoly Market dominated by a few large profitable firms. Market dominated by a few large profitable firms. Ex: airlines and gas companies. Ex: airlines and gas companies.

11. Summary activity – answer the aim. Summary activity – answer the aim.

12. HOMEWORK Expect to have a test again by the end of next week Expect to have a test again by the end of next week