| Course | GB540 Economics for Global Decision Makers |
|---|---|
| Unit | Unit 5 |
| Paper type | Market structure comparison |
| Length | About 1,120 words, 7 pages double-spaced |
| Format | APA 7 student paper |
| School | Purdue University Global |
| Program | MBA |
| Updated | October 2026 |
Free sample paper for GB540 Unit 5
Three Concentrated Markets, Three Kinds of Conduct: A Unit 5 Market Structure Comparison for Electric Outboards
[Student Name]
Purdue University Global
GB540: Economics for Global Decision Makers
Unit 5 Market Structure Comparison
[Instructor Name]
[Date]
Ruddiman Marine, its rivals and every market share are composite and illustrative; the merger guidelines and economics sources cited are real.
Why Structure Matters for Pricing
Ruddiman Marine sells small electric outboards in the United States, Norway and Australia. Its pricing decisions in Unit 6 depend on how rivals respond when it changes price, and that response depends on the structure of each market. This paper compares three markets: US electric outboards under 10 kilowatts, where Ruddiman competes directly; US gasoline outboards under 20 horsepower, which buyers treat as substitutes; and Norwegian small electric outboards, Ruddiman's second-largest export market. Australia is left out because Ruddiman sells there through a single distributor whose shares data are incomplete.
The Concentration Table
Each market's shares come from registration and import data for the last full season.
US electric outboards under 10 kilowatts. A German electric specialist holds 33 percent, a Chinese maker selling mostly online 23 percent, Ruddiman 17 percent and a US trolling-motor brand moving into larger motors 15 percent. Three smaller firms hold 5, 4 and 3 percent. The four-firm concentration ratio is 88 percent, and the Herfindahl-Hirschman Index, computed by squaring each firm's share and adding the results, is 2,182.
US gasoline outboards under 20 horsepower. Two Japanese makers hold 29 and 28 percent, a US maker 24 percent and a third Japanese maker 13 percent. Three importers hold 2 percent each. The ratio is 94 percent, and the index is 2,382.
Norwegian small electric outboards. A European electric specialist holds 45 percent, a Nordic boat-equipment group 22 percent, Ruddiman 13 percent and a Chinese maker 10 percent. Four smaller sellers hold 4, 2, 2 and 2 percent. The ratio is 90 percent, and the index is 2,806.
What the Indices Say
All three markets sit above 1,800 on the Herfindahl-Hirschman Index, the threshold the 2023 Merger Guidelines use for a highly concentrated market (U.S. Department of Justice & Federal Trade Commission, 2023). By that measure, the three are alike. The four-firm ratios, 88 to 94 percent, say the same.
Yet the indices are close while the markets behave very differently. The Norwegian index is higher mainly because of one firm: its leader's 45 percent contributes 2,025 of the 2,806 points. The US gasoline index is high because four firms are each large. The US electric index sits between them. An index summarizes the distribution of shares; it does not show how firms set prices.
Profile 1: US Electric Outboards
Entry barriers. Low. Battery packs, controllers and motors are bought from suppliers, and assembly needs little capital. Two new brands entered last season, both selling online.
Product differentiation. Moderate. Motors differ in power, battery capacity and integration with boat electronics, but buyers compare specifications easily.
Observed pricing. Prices change often and independently. The Chinese maker cut prices twice last season, and the German specialist responded once with a dealer promotion rather than a list price cut. Ruddiman's own estimated elasticity of about minus 2.31, from Unit 3, is consistent with buyers who compare.
Profile 2: US Gasoline Outboards
Entry barriers. High. Engines must be certified for emissions, and dealer networks built over decades carry service and parts.
Product differentiation. Low among the large firms, whose motors are similar in power and reliability.
Observed pricing. List prices move once a year, usually within weeks of each other, after the largest Japanese maker announces. Shares have moved less than two points in five years. This is the pattern of price leadership in a tight oligopoly.
Profile 3: Norwegian Small Electric Outboards
Entry barriers. Moderate. The leader's dealer network covers the coast and most inland lakes, and buyers value local service through the long winter.
Product differentiation. Moderate, with the leader's brand carrying a premium.
Observed pricing. The leader sets its price each spring at NOK 52,900 for its comparable motor, and the other sellers price below it: Ruddiman at NOK 49,900 and the Chinese maker lower still. When the leader raised its price two seasons ago, the others followed within a month. This is the pattern of a dominant firm with a competitive fringe.
The three markets share a concentration category, but one behaves as rivals, one follows a leader and one prices under a dominant firm, and that difference decides how much room Ruddiman has.
A Spectrum of Conduct
Placing the three on a spectrum from rivalrous oligopoly to dominant firm with a fringe, US electric sits nearest rivalry, US gasoline in the middle as a coordinated oligopoly, and Norway nearest dominance. Bresnahan and Reiss (1991), studying isolated markets, found that most of the change in competitive conduct comes with the entry of the second and third firms, with little further change after that. The finding suggests that counting firms or summing shares, once a market has several sellers, says little about conduct, and that observed pricing behavior is the better guide.
What Each Structure Permits Ruddiman to Do
In US electric outboards, Ruddiman has little room to set price far from its rivals. Its markup must reflect buyers who compare, and new entrants limit any increase. A modest rise is possible only if its estimated elasticity supports it, which Unit 6 tests.
In US gasoline outboards, Ruddiman sets nothing, but the leader's annual price announcement shifts its demand through the cross-price effect of about 1.09 estimated in Unit 3. A gasoline price rise each spring gives Ruddiman room to follow upward.
In Norway, Ruddiman can price up to just below the leader without losing its position in the fringe. Its current price of NOK 49,900 leaves a gap of NOK 3,000 below the leader. The Lerner index, the gap between price and marginal cost as a share of price (Lerner, 1934), is about 0.30 in Norway against about 0.32 in the United States, which suggests Norway can bear a larger markup than Ruddiman currently charges.
Limits
Shares come from one season. The US electric market is changing fast enough that shares a season from now may differ by several points. The Norwegian leader's behavior is inferred from two price changes, not a long record. And the gasoline market's annual pattern could break if one of the Japanese makers moved its small motors to electric power, which two of them have announced for later models. If that happens, the gasoline and electric markets will begin to merge, and the shares in this paper will need to be computed for a single small-outboard market rather than two.
References
Bresnahan, T. F., & Reiss, P. C. (1991). Entry and competition in concentrated markets. Journal of Political Economy, 99(5), 977-1009. https://doi.org/10.1086/261786
Lerner, A. P. (1934). The concept of monopoly and the measurement of monopoly power. The Review of Economic Studies, 1(3), 157-175. https://doi.org/10.2307/2967480
U.S. Department of Justice & Federal Trade Commission. (2023). Merger guidelines. https://www.justice.gov/atr/merger-guidelines
GB540 Unit 5 instructions, in plain terms
Unit 5 of GB540 asks you to compare the structure of several markets relevant to a firm. Explain why structure matters for the firm's pricing. For each market, list every firm's share, then compute both the top-four share and the sum of squared shares, showing enough detail for a reader to recompute them. Compare the indices with the thresholds in current merger guidelines. Then profile each market's entry barriers, product differentiation and observed pricing behavior. Place the markets on a spectrum of conduct, from rivalrous oligopoly to a dominant firm, and explain any gap between what the indices say and how firms behave. State what each structure allows the firm to do on price. Close with the limits of the data. About six pages with one table and three profiles is a common format for this comparison.
How this GB540 Unit 5 example is built
The sample explains why Unit 6 pricing depends on rivals' responses. A concentration table lists every share, and a margin note explains how the index weights the largest firm. All three markets exceed the 2023 Merger Guidelines threshold. The paper shows that the Norwegian leader alone contributes 2,025 index points. Profiles follow: low barriers and frequent price moves in US electric, certification barriers and annual price leadership in US gasoline, and a dominant leader at NOK 52,900 in Norway. The highlighted sentence states the difference in conduct, Bresnahan and Reiss explain why indices miss it, and sections state Ruddiman's pricing room in each market using Lerner's index, then the limits of one season's shares.
Reading the GB540 Unit 5 grading rubric
The GB540 market structure comparison is graded on accurate measurement and on linking structure to conduct. Shares, concentration ratios and indices should be complete enough to recompute. Comparing indices with current merger guideline thresholds shows awareness of policy. Profiles earn credit when they cover entry barriers, differentiation and observed pricing with specific evidence. Explaining why markets with similar indices behave differently is valued at MBA level. Placing markets on a spectrum of conduct shows synthesis. Stating what each structure permits the firm on price connects the analysis to decisions. Limits of the share data should be acknowledged. Economic sources and the guidelines should be cited accurately in APA 7.
GB540 Unit 5 help: mistakes that cost points
Many GB540 market structure papers compute an index and classify the market from that number alone. Others describe structure in textbook terms without observed pricing behavior. Students often list shares without enough detail to check the index. The firm's own pricing room is left unstated. Differences between markets with similar concentration go unexplained. Limits of the share data are ignored. Give full shares, compute both measures, compare with the guidelines, profile entry, differentiation and pricing, explain where indices and conduct diverge, state what each structure lets the firm do and note the data's limits. Send your market data, and our team can help build the comparison.
Get a GB540 Unit 5 example written to your instructions
Which markets or industries does your Unit 5 comparison cover? Name them, and add any share data, the prompt and the rubric. Within 24-48h the comparison arrives with concentration computed, conduct evidenced, and a pricing implication for each market. First custom samples are free. If one firm's pricing room is the real question, name it. The paper above is an original model document written by our desk, not a submitted student paper and not an official Purdue University Global document.
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GB540 Unit 5 questions, answered
How is the Herfindahl-Hirschman Index calculated?
Square each firm's market share, expressed as a whole-number percentage, and add the squares. A market of four firms at 25 percent each gives 2,500; a monopoly gives 10,000. Current federal merger guidelines treat values above 1,800 as highly concentrated. Show the calculation for at least one market, and check that the shares you use add up to 100.
Which market structure models does the unit expect?
Usually perfect competition, monopolistic competition, oligopoly and monopoly, with oligopoly often subdivided into models such as kinked demand, price leadership, the dominant firm and game-theory approaches. Your course text sets the list. Choose the model that fits the evidence for each market, and say what behavior would show that a different model fits better.
Can I use real companies in the comparison?
Often, yes, and published market-share estimates make the concentration calculation easier. Cite the source and year, since shares change. If your prompt asks about a firm you work for, or reliable data are unavailable, a composite market labeled as such works, provided the reasoning from structure to conduct is sound.
Where can I find a free GB540 Unit 5 sample paper?
This page holds a full GB540 Unit 5 market structure comparison for three outboard markets, with concentration measures and profiles of rivals' pricing.
Why can two markets with similar indices behave differently?
An index summarizes shares but not conduct. One market may have rivals who undercut each other while another follows a leader, even with nearly the same concentration.