Part III
Recognizing Rivals: Market Structures and the Decision-Making Environment
In this part . . .
The most important factor business owners control is the ability to set their product’s price. The price business owners set determines the quantity of the product they sell. However, the ability to set price is not unconstrained; business owners have to consider consumer demand for their product and the behavior of rival firms providing the same or a similar product. In this part, I present theories for determining price based upon the number of rivals — degree of competition — a firm has. Rivals necessitate strategic decision-making, so I cover game theory as well as additional special situations for price determination.
