Predatory pricing

Margaret Levenstein and Valerie Suslow seek out what determines a business cartel’s success. They reject the assumption of many economists that the main reason cartels fail comes from cheating firms, which undermine attempts by cartels to collude to raise prices and restrict output. They believe that cheating is just one facet of how a cartel can fail and not the main reason. To answer their question, Levenstein and Suslow attempt to answer four other research questions: 1. Can cartels succeed? 2. How long do cartels last? 3. What impact do cartels have? 4. What causes a cartel to break up or fail? Using a variety of quantitative evidence, Levenstein and Suslow use these questions to determine what aids in a cartels success. They contend that while many cartels fail, many do succeed, and their success stems from how they can collaborate, deter cheating, and bar entry by other firms. Levenstein and Suslow admit that since cartels are usually secretive and illegal, their empirical evidence is limited and cannot be based on random samples. Most of the evidence is extracted from law enforcement prosecutors and governments that allow cartels to reside. They both agree that it is difficult to guess the success of cartels because of their secretiveness and ability to stay under the radar of regulatory agencies. However, Levenstien and Suslow pull a great deal of data from the cases they have and create a strong argument for how cartels succeed despite the limited amount of case…

such as General Motors, Xerox, Black & Decker and Nieman Marcus are improving their relationship with their suppliers in order to gain a competitive advantage (Ganesan and Shanker, 1994). This is due to the fact the producers have a major effect on the technological environment of organizations. As organizations want to compete effectively in order to generate customer satisfaction, they need to find producers who are more technological advanced in order to deliver faster and still produce…

If you happen to seek advice from your friends, then you've probably heard people say that payday loans are always bad. Then it's usually where the conversation ends. But that doesn't really solve any of your problems cause chances are, you're still going to need the money - which made you think of considering a loan in ht first place. In this post, we will be discussing a lot about payday loans, what problems are to be expected with them, and somewhat get into the reasons why a lot of people…

Don’t even get me started on payday loans I totally disagree with payday loans they are the most un-wanting, useless and unworthy loan which puts you in debit for the rest of your life! Payday loans are getting young people to borrow money so much money that they have to own it back for the rest of their life. How can someone live with so much debit dangling down form their head? Payday loans are persuading youngsters to come and borrow cash, they make it look so attractive that everyone wants…

Marketing Communications Memo PSY/322 February 6, 2012 Charles Dudek Marketing Communications Memo There is no doubt that having a better understanding of different consumer demographics will impact marketing and has an effect on marketing communications. How messages are communicated most effectively can change depending on who the target audience is. A message that is targeting young consumers, like an advertisement for the Twilight movie would be different than one targeting…

Oligopoly The market structure being considered is an oligopoly. An oligopoly occurs when there are “few sellers and interdependent price-output decisions” (Hirschey, 2009, p.500). Only a small amount of companies are responsible for the majority of the industry’s output. Also, it is difficult to enter or exit the industry. Decision making is influenced in an oligopoly by the high rate of competition. Since there are only a few companies in the industry any change will generate an immediate…

Your company, Bright Paints, is one of a dozen companies manufacturing a special reflective paint used for traffic signs. The State Department of Transportation has called for tenders to supply 10,000 gallons of blue reflective paint to be delivered within two months. You can foresee fitting in a production run of the blue paint and have decided to bid on the job. You calculate your incremental costs for this job to be $76,200. This particular contract is standard, similar in all in respects to…

suppliers, market conditions, consumer mindsets, and messaging–must be considered and reconsidered in China. Pricing decisions can be very intricate, especially in global markets. The Chinese retail market marketing mix is as relevant as ever for marketers trying to tackle it. Pricing is controlled by tough competitive conditions, market segments, location and tight consumer wallets. Promotion contains the point of sale, including both products and services. It is affected not only by the…

engineers and fabric technician’s work together to ensure The North Face products can be used in the most severe weather conditions. The North Face uses value-added pricing as the brand puts a lot of effort to differentiate their products from their competitors (Pearson Learning Solution, 2014). Their constant work on innovation and development of new technologies to make their products better than any others lets The North Face put a higher price on their products. The strong brand image plays…

The downside to this strategy is that if the prices are too high, the products will not sell and the organization will not make any money for the charity. With penetration pricing, the organization will start off by making a small profit by selling their products for a low price to attract the attention of customers. As time goes on, these prices will increase, generating more profit for the charity. A disadvantage to this method is that at the beginning, the profit will not be a lot and may not…