Principles of Economics: Microeconomics - Introduction to the Competitive Firm

How does a company really behave? We tend to assume profit — the bottom line — is the main motivation for a firm’s actions. For most firms most of the time, this is a good assumption, especially in a competitive market. With this video, you will explore how a company maximizes profit in a competitive environment where there are many buyers and sellers. This idea comes with a few surprises. Does a company really control what price it sets? Or does the market determine the price? Here’s a clue. If you owned an oil well, even your mother wouldn’t buy your oil if she could get the same oil somewhere else for less money. Watch and find out why. Microeconomics Course: http://bit.ly/20VablY Next video: http://bit.ly/1QEKjvc Help us caption & translate this video! http://amara.org/v/GSLB/