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The Nature of Competitive Industries - Pizza Sellers

Firms like Papa John's, Domino's, and Pizza Hut sell pizza and other products that are differentiated in nature. While numerous pizza chains exist in most locations, the differentiated nature of these firms products permits them to charge prices above marginal cost. Given these observation, is the pizza industry most likely a monopoly, perfectly competitive, monopolistically competitive, or an oligopoly industry? Use the casual view of structure, conduct, and performance to explain the role of differentiation in the market for pizza. Then apply feedback critique to the role of differentiation in the industry.

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Pizza industry is a monopolistically competitive industry wherein a large number of players compete in the marketplace and try to differentiate their products from each other and thus, charge different prices. No particular pizza manufacturer has total control over the market price. There is a great deal of non-price ...

Solution Summary

The nature of the pizza industry is analysed and this conclusion is defended with reasoned explanation. 196 words.