Determine how the assumptions or predictions of a model may need to be modified to apply to the real-world situations.
Keep in mind that throughout this course, papers are intended to bring real-world situations to the course material that we are covering each week. Part of your grade will depend on the connections you make between your chosen firm (which could include the economic environment of your chosen firm, the markets in which your chosen firm interacts with outside actors, the decisions your chosen firm makes, etc., depending on the particular question), the material from the chapters we covered in the week, and, when applicable, your own experience.
For the particular firm/business you selected, describe the markets in which the firm participates that are close to perfectly competitive. Note that for most firms that students choose, the market for the firm’s output is not perfectly competitive—it more resembles monopolistic competition or oligopoly. However, it is very likely that some of the inputs to the firm’s production are close to perfectly competitive markets. Do those markets completely satisfy the assumptions of perfectly competitive markets? Are there some assumptions that are just “mostly satisfied” or “nearly satisfied”, but close enough so that the ideas of Perfect Competition can still be applied? What are those differences, if any exist? How might those differences affect the conclusions of chapter 14?
Could there be external events that affect the perfectly competitive market? What changes might occur? (Think about what you learned in chapter 4.) How would those changes affect your chosen firm and what decisions would your firm change—would those changes be drastic or minor?
Writing Requirements (APA format)
1.5-2 pages (approx. 300 words per page), not including title page or references page
12-point Times New Roman font
Title page with topic and name of student
Grading and Assessment
This activity will be graded based on academic content, integration of resources, and college-level writing and grammar. Refer to the Written Analysis Grading Rubric (in Course Documents)
Course Learning Outcome(s): 1, 2, 5
1. Apply the Ten Principles of Economics (basic economic axioms) to real-world situations.|
2. Predict market outcomes using simple Microeconomic models.
5. Apply the simple Microeconomic models to real-world situations and determine how the assumptions or predictions of a model may need to be modified to apply to the real-world situations.