BEE1034 Week5
Understanding Markets
Managerial Economics: A Problem Solving Approach (2 nd Edition)
Luke M. Froeb,
Brian T. McCann,
Website, managerialecon.com
© 2010 Cengage Learning. All Rights Reserved. May not be copied, scanned, or duplicated, in whole or in part,
except for use as permitted in a license distributed with a certain product or service or otherwise on a password-
protected website for classroom use.
, Introduction
• Last week, we looked at how an individual firm sets
prices to maximise profits.
• This week, rather than focus on a particular firm, we will
focus on the industry as a whole.
• Here, thinking not about how Apple sets iPhone price, but
more about the market for smart phones.
• Can use our understanding of the market as a whole to
consider an outcome for a particular firm e.g. bankruptcy
Understanding Markets
Managerial Economics: A Problem Solving Approach (2 nd Edition)
Luke M. Froeb,
Brian T. McCann,
Website, managerialecon.com
© 2010 Cengage Learning. All Rights Reserved. May not be copied, scanned, or duplicated, in whole or in part,
except for use as permitted in a license distributed with a certain product or service or otherwise on a password-
protected website for classroom use.
, Introduction
• Last week, we looked at how an individual firm sets
prices to maximise profits.
• This week, rather than focus on a particular firm, we will
focus on the industry as a whole.
• Here, thinking not about how Apple sets iPhone price, but
more about the market for smart phones.
• Can use our understanding of the market as a whole to
consider an outcome for a particular firm e.g. bankruptcy
