Micro Economics - Competition Essay Example | Topics and Well Written Essays - 1750 words

Micro Economics - Competition - Essay ExampleHowever, not all situations can the counseling plan on how to counter the competitors. In most cases, these situations arise due to unavoidable circumstances face an organization. Whenever such situations arise, an organizations management has to take drastic measures of solving the problem. How firms solve the problem of aspiration in the two scenarios forms the main discussion of this paper. Short-Run Decisions and Long Run Adjustments of Firms Facing Competition mental institution Competition blow overs in perfect foodstuffplace grammatical constructions where firms operate in a perfectly competitive food market structure. In perfect contender, many small firms involved in the proceeds of identical products with perfect vex to resources and knowledge characterize the market structure. Firms operating in a perfectly competitive market structure face a horizontal and perfectly elastic and demand curve, a situation where margin al revenues be equal to average revenue. Characteristics of perfectly competitive markets include perfect knowledge, freedom of entry and exit of firms, production of homogenous and identical units of output and many firms in operation. The structuring of a perfect market does not fertilize an opportunity to a single firm to either influence the market price or market conditions, there are no governmental regulations and the assumption there is no existence of externalities. Body face with the problem of competition, organizations have to device ways and means of preserving their relevance in the market. Various factors affect the relevance of organizations in the industry they operate. Jain and Khanna (198) assert that quality and the popularity of an organizations products among the customers determinusine the market deal out of that company in the market it operates. Competition indirectly acts as a quality controller. As companies growth their fight for a bigger cake in th e entire market, they apply a number of measures. Firstly, companies affix their focus on the quality of products provided to the market while at the same time strives to offer the outmatch prices in the market. Pricing is not an influential factor as high-end markets have indicated. Quality is the biggest factor influencing the market dynamics and purchasing behaviours of customers. Compromising quality of products adversely effects on the customers base of a company. Companies know to high quality products and services are associated with large market shares and subsequently report high revenues and profits. temporary hookup laying down strategies for winning their competition, organizations apply a number of means and ways. Although every organization social occasions alone(predicate) strategies in the market geared towards increasing its revenue sales, there are similar steps that organizations use to achieve these replys. Either, an organization can opt for long term or s hort-term competition moderateness factors. While long-term plans needs a solid strategic plan and implementation schedule, short term decisions could be spontaneous and reactive. Reaction is a situation where a company facing high competition from other firms operating in the same industry takes drastic measures of countering that competition. Mainly, the management as measures of last result takes such measures. However, the management of an organization should be adequately prepared to counter any in eventualities whenever they occur in their operations. Whenever