ECON 101 Lecture Notes - Lecture 9: Oligopoly, Chapter 11, Title 11, United States Code, Disposable And Discretionary Income

• School: U of M
• Department: Economics
• Course: ECON 101
• Professor: William James Adams

Document Summary

Manufacturers produce many components to a inished automobile: electrical, fabric, mechanical etc. This is a durable product which does not disappear upon use. Distinguish between retail level vs. wholesale level. Consumer tend to spend a great deal of time searching at the retail level. (time related cost) Nonetheless, since price per unit is high, more search is done by consumers at any level. Stage #1: origin to wwii (late 19th century - 1940s) Focus on companies that started their lives as assemblies. Michigan was a very attractive place to produce automobiles because the carriages and frames were made up of wood which was plentiful in the state of michigan. Also, due to high transportation cost, irms are located near michigan. Rise of concentrations of assemblies in the late 1890s to 1940s which led to the emergence of 3 big assemblies. Lower unit cost > lower prices > demand increases > proit increases: beneiting from interchangeable parts and moving assembly line.