Market Structure

Competency

Understand various market structures and impacts upon firms, consumers, and government policies.

Course Scenario

Oil Company X is a large oil refinery which has been expanding and  taking on new investment projects. Recently, they have considered  building a pipeline that stretches across the United States, from Canada  to New Orleans.

The Cost Department is looking to determine the impact of the  pipeline on the current market structure, and they have asked you, a  team member of the department, to submit a report on the expected  changing market structure.

Instructions

As a cost analyst at your firm, you are asked to evaluate the type  of market you are performing in. Assume the current number of oil  companies exist in the market. After the pipeline is built, extensive  trade restrictions will drastically increase Oil Company X's hold on the  market.

Submit a 2-page report detailing the current market structure, and  the anticipated market structure after the pipeline is built. You will  also include tables to show the characteristics of each of the above  market structures and where our firm conforms or does not conform to the  characteristics of the different market structures. Be sure to explain  the impact on price and quantity, and any pertinent changes to the  firm's pricing strategy after the change in market structure.

The current market shares of each company are shown below, before  the pipeline is completed and trade restrictions are implemented.

Format your report to include a title page, introduction,  conclusion, and references. Include all relevant graphs, equations, and  calculations. Show your work on calculations to ensure you receive  partial credit for incorrect answers. No credit will be given if your  work is not shown. Remember to cite your sources using correct APA  format, and also use correct grammar, spelling, and formatting.