Question

Consider two groups of people who shop at the same Wal-Mart: the Convenience Shoppers and the Bargain Shoppers. Which of the Sllowing statements is most likely to be true?

O Wal-Mart is more likely to have monopoly power over Convenience Shoppers because this group is more likely to splurge on something on a whim rather than stick to their prearranged shopping list.

O Wal-Mart is more likely to have monopoly power over Bargain Shoppers because this group is more likely to splurge on something on a whim rather than stick to their prearranged shopping list.

O Wal-Mart is more likely to have monopoly power over Convenience Shoppers because this group is more likely to stick to their prearranged shopping list rather than splurging on something on a whim.

O Wal-Mart is more likely to have monopoly power over Bargain Shoppers because this group is more likely to stick to their prearranged shopping list rather than splurging on something on a whim.

Answer 1

Wal-Mart is more likely to have monopoly power over Convenience Shoppers because they are prone to making impulse purchases, which allows Wal-Mart greater control over pricing for this group.

Step-by-step explanation:

Regarding the question of which group Wal-Mart is more likely to have monopoly power over, the Convenience Shoppers or the Bargain Shoppers, the answer relates to the typical behaviors associated with each type of shopper. Convenience Shoppers are individuals who prioritize the ease and speed of their shopping experience and are less sensitive to pricing, whereas Bargain Shoppers are more price conscious and are inclined to stick to a list to avoid unnecessary spending. Therefore, Wal-Mart is more likely to have monopoly power over Convenience Shoppers because this group is more likely to make impulse purchases without considering alternatives, giving Wal-Mart greater pricing power over these consumers.

When discussing monopoly and market structures, it is important to understand the different types of market organizations. Unlike monopolies, which have a single seller, oligopolies consist of a few large firms dominating the market, sometimes leading to collusive behavior to achieve higher profits at the expense of competition. In the context of monopolies and oligopolies, the competitive dynamics and consumer behavior can significantly influence a firm's level of control and pricing power in the market.