Responses to classmates0osts 

First:

This weekàlearning objectives related to my nursing role focused on the different types of industry structures: competitive, monopolistic, and monopolistically competitive. In understanding the differences between these industry structures, I better understood how competitors behave in different markets and how firms make decisions to maximize profits.

Many buyers and sellers, homogeneous products, perfect information, and no transaction costs characterize competitive markets. In these markets, the market demand sets the price, and firms earn zero economic profits in the long run (Larry Louie, 2021). In contrast, monopolies are characterized by one firm controlling the entire market with no close substitutes. The sole seller of goods in this market has greater market power and can set the price. The sources of monopoly power can be scale, scope, cost complementarities, or legal protection. Monopolies have one clear point to maximize revenue, and that is the point of unitary elasticity.

Lastly, monopolistic competition is a fairly common market structure with many buyers and sellers, but each firm makes a differentiated profit (Kumar, 2020). There is an incentive for firms to differentiate, and there are close substitutes, but there is a way to modify demand based on the firmàactions. Profit maximization in this market structure is done by determining the marginal revenue and marginal cost and then translating up to the demand curve to set the price. In the long run, the price is set based on the average total cost for all the competitors.

In terms of my nursing role, understanding the different industry structures and the implications of each helps me to understand the competitive landscape of the healthcare industry. Knowing how prices are set and what incentives are in place for different firms to enter or exit the market can help me make informed decisions about my career and the healthcare system (Kichko & Picard, 2022). Furthermore, understanding the underlying economics of the healthcare market can help me better understand the strategies of different healthcare organizations and how they can benefit patients.

Second:

This week has been fundamental in advancing my understanding of the different market structures and how firms in each structure can maximize their profits. There are three primary market structures discussed this week: the competitive, monopolistic, and monopolistically competitive markets. Compared to the other two, firms in a competitive market generate zero returns in the long term. This market structure is more hypothetical than real, considering that very limited real-life markets have all the conditions to facilitate the sustainability of a perfectly competitive market. 

Another key observation from this week’s materials is that compared to firms operating in perfectly competitive markets, monopolies have no supply curve. Competitive firms have a supply curve because they determine their output based on price. However, a monopolist determines how much to produce based on marginal revenue which is less than price. This implies that a change in quantity will change the market price. Thus, there is no supply curve for a monopolist, or in markets served by firms with market power. Also, while monopolists have a strong power over the market, their power is limited by demand.

These observations and takeaways have a strong correlation with my role as a nurse. In offering patient care, the cost of care becomes a major base factor because of the role it plays in determining the revenue from the process, and the value of care delivered. The model of monopolistic competition suits the behavior of the United States healthcare sector. That is because, in terms of profit maximization and cost of care, firms can explore product differentiation for the services and products that customers do not bear the full costs of care.