In 1985,International Data Corp

question 29

Essay

In 1985,International Data Corp.(IDC)estimated that 3.7 million desktop computers had been sold at an average price of $1,054.In 2000,the number sold in the United States had risen to 132 million,with the average price decreasing to $700.The change in individuals' tastes and preferences has increased their demand for computers.Explain how the price of computers dropped over the 15-year period from 1985 to 2000.

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Definitions:

Degree Of Monopoly

The extent to which a particular firm or entity controls the market share in a monopoly, influencing prices and market conditions.

Localized Markets

Areas where businesses sell products or services within a specific geographic region or demographic.

Herfindahl Index

A measure used to calculate the concentration of market power within an industry by summing the squares of the market shares held by each competitor.

Market Power

The ability of a firm or group of firms to influence or control the terms and conditions of the market to their advantage, often through controlling supply, manipulating prices, or creating barriers to entry.