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The document discusses the market dynamics characterized by a duopsony, where two major buyers dominate and exert significant power over numerous sellers. This concentration leads to vulnerabilities for sellers, barriers to entry for new competitors, and potential collusion between buyers, ultimately affecting competition and innovation. The buyers' influence allows them to set prices and terms, often to the detriment of sellers.

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Abigail Kim
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18 views3 pages

Document (5

The document discusses the market dynamics characterized by a duopsony, where two major buyers dominate and exert significant power over numerous sellers. This concentration leads to vulnerabilities for sellers, barriers to entry for new competitors, and potential collusion between buyers, ultimately affecting competition and innovation. The buyers' influence allows them to set prices and terms, often to the detriment of sellers.

Uploaded by

Abigail Kim
Copyright
© © All Rights Reserved
We take content rights seriously. If you suspect this is your content, claim it here.
Available Formats
Download as DOCX, PDF, TXT or read online on Scribd
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1.

Sellers are heaνily reliant on the two buyers for their sales, making them
vulnerable to the terms and conditions set by the buyers.

A. Dependence of Sellers

b. Barriers to entry for sellers

c. Potential for Collusion

d. Information Asymmetry

2. The market is characterìzed by a high degree of concentration due to the


dominant position of the two buyers, which can lead to reduced competition
and innovation imn the market.

A. Information Asymmetry

b. Economic Concentration

c. Multiple Sellers

d. Significant Buyer Power

3. Only two major buyers dominate the market demand for a particular
product or service.

a. Multiple Sellers

b. Significant Buyer Power

c. Limited Number of Buyers

d. Barriers to Entry for Sellers

4. Numerous sellers or suppliers compete to sell their products or services to


these two buyers.

a. Economic Concentration

b. Multiple Sellers

c. Limited Number of Buyers

d. Significant Buyer Power


5. The two buyers possess substantial market power, enabling them to
influence the price, quality, and terms of the products or services they
purchase.

a. Barriers to Entry for Sellers

b. Potential for Collusion

c. Limited Number of Buyers

d. Significant Buyer Power

6. Due to their market power, the buyers in a duopsony can set or influence
the purchase price, often to the detriment of the sellers.

a. Price Setting

b. Economic Concentration

c. Dependence of Sellers

d. Multiple Sellers

7. The dominant position of the two buyers can create barriers to entry for
new sellers, further consolidating the market power of the existing buyers.

a. Barriers to Entry

b. Price Setting

c. Significant Buyer Power

d. Information Asymmetry

8. The two buyers may give support to each other to strengthen their market
power,potentially leading to unfair business practices, reduced competition,
and higher profits at the expense of the sellers.

A. Significant Buyer Power

b. Barriers to Entry for Sellers

1. c. Pote

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