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Market power in governments should do to a company

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What is market power? What governments should do to a company with market power?

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Solution Summary

Market power is defined. What governments should do to a company with market power is determined. AT&T is examined.

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Market Power
Market power is defined as the capability of a company to by its self to raise prices above market levels without losing sales and profitability.
Factors frequently considered in determining whether a firm has market power include:
? Market Share
? Barriers to Market Entry
? Pricing Behavior
? Profitability
? Vertical Integration

Market share is a key component and can be measured in several ways?
 including monetary value,
 units of sales and production and
 production capacity.

Market share alone can be an inaccurate measure of market power since a company with significant market share will have enough market power to capability to behave anti-competitively on its own. ...

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