Case Study - Kmart

Using economic principles discussed thus far:

1. What were some of Kmart's major strengths? Did they try to build barriers to entry? Identify one barrier they tried to establish.

2. In 1995 Kmart was the 15^th largest corporation in the world. Seven years later it filed for bankruptcy. Why did it fail? Identify at least one relevant determinant of demand that negatively affected its demand curve.

3. Now let's think about the strategies of its competitors and market structure. How did Kmart's competitors try to carve out a niche in an otherwise enormous market? Did they try to create barriers to entry? Name at least one barrier.

4. Finding your niche with customers. Which determinant of demand was Walmart targeting, and what was Target's target.Did Kmart have one? What happened?

5. What was Kmart's final attempt to stay afloat? How did Walmart respond to Kmart's price change. After emerging from bankruptcy it merged with Sears. Has that worked out well for them?