Economics (Micro And Macro) Essay Example | Topics and Well Written Essays - 1000 words

Economics (Micro And Macro) - Essay ExampleThe BAs main reason for participating in this alliance is the possibility to reduce the ticket prices on direct transportation due to the bigger amount of profit.Despite the fact that anti-monopolistic committee allowed the partnership, the airline company utter(a) Atlantic sets protests against it. The merge of two big companies will make them monopolists in their service sphere. As mentioned preceding(prenominal) the bigger profit allows the owners to provide better services, to have upgraded planes, to set lower prices on the tickets and what is even more important to provide the better level of security. The company with average profits will be driven off the market. To fight this injustice they even applied the anti-advertising technique by putting the following meat on their airplanes No way to BA/AA. The headquarter of a new alliance will be get offd in London since the controlling interest belongs to BA.Analyzing this articl e it is necessary to point out several issues that argon to be considered in details. The first notion is monopoly since the new alliance represents the monopolistic leader in Europe. though at the same time considering the whole world where BA+AA will have the third place in volume of passengers transportation, it is necessary to point out that in the scale of the world competition we disregard observe the monopolistic competition. The second notion that is to be analyzed is merge and strategic alliance in order to identify the type that BA and AA has.In books on economics one can happen upon the following definition of monopoly as If a certain firm is the only one that can arrest a certain good, it has a monopoly in the market for that good (Samuelson & Marks, 2003). When studying monopoly in theory it is ordinarily accepted that only one company operates in its industry - it produces and sells the whole volume of products. Though, in manner monopoly is represented by a big c ompany that controls the biggest part of