1.5. Some people think that businesses create monopolies by destroying their competition, and there is certainly some...

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1.5. Some people think that businesses create monopolies by destroying their competition, and there is certainly some truth to that. But as we learned from Obi-Wan Kenobi, "[Y]ou will find that man of the truths we cling to depend greatly on our own point of view."

For instance, some people (Convenience Shopper ) love shopping at one particular store and will only switch stores when a product is outrageously expensive, while other people

(Bargain Shopper ) will gladly pend hours looking through new paper advertisements earching for the be t deal.

a. When both kinds of people, the Convenience hopper and the Bargain Shopper , are hopping at the same W al-Mart, who i more likely to tick to their prearranged hopping list, and who is more likely to plurge on a little something?

b. Which group doe W al-Mart have monopoly power over? Which group does W al-Mart have no monopoly power over?

c. Does this mean that the same shop can si multaneously be a "monopolist" to some customers and a "competitive firm" to other customers? Why or why not?

d. Does this mean that Darth Vader really did kill Anakin Skywalker?

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Modern Principles Microeconomics

ISBN: 9781429239998

2nd Edition

Authors: Tyler Cowen, Alex Tabarrok

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