When considering pricing strategies the components of cost, competitor considerations, strategic goals, and member usage patterns for all products, not just a single product, must be taken into account. This 3 page paper addresses competitive markets and proposes that competitive strategy rests on the theory of efficient markets. The microcompetitive model performs as the foundation of industry analysis, identifies factors in industry profit differences, and explores the analytical concepts underlying the opportunity costs of capital. Industry analysis stands as a cornerstone of competitive strategy. It incorporates the Five Forces Model of Industry: (1) intensity of competition or rivalry; (2) presence of substitute products; (3) buyer power; (4) power of suppliers; and (5) impediments to market entry. The theories and propositions of George Stigler are examined. Bibliography lists 5 sources.
Name of Research Paper File: D0_KTmarket2.wps
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