Five forces that affect the competitive enviroment of the firm

1. Barriers to Entry

a. Types of Barriers to Entry

b. When New Companies Will Attempt to Entry

2. Market Competitiveness

a. Ability of Rival Firms to Respond to Chang

b. Advertising of Rival Firms

c. Research and Development of Rival Firms

e. Increase in Competition

3. Extence of Substitute Products

4. Bargaining Power of the Customers

a. Large Volume of a Firm's Business

b. Availability of Information

c. Buyer's Low Cost of Switching Products

d. High Number of Alternate Suppliers

5. Barganing Power of the Suppliers

a. Firm is Unable to Change Suppliers

b. Reputation of Supplier and Demand for its Goods

Monopolistic Competition

Assumptions and Market Conditions

1. Numberous firms with differentiated products

2. Few Barriers to entry

3. The ability of firms to exert some influence over the price and market

4. Significant non-price competition in the market

Oligopoly

1. Relatively few firms with differentiated products

2. Farily significant barriers to entry

3. Strongly interdependent firms (price tend to fixed)