Samsung was founded by Lee Byung-Chull in 1938 and began as a small trading company in Seoul. He began with electronics, and then step into the telecommunications industry in 1970 to produce today’s mobile phones. Since mobile phone industry has been getting bigger and verified, it’s necessary to compete with other rival firms such as Nokia, Apple, Motorola and so on. Especially Nokia, the largest mobile phone manufacturer in the world, has threatened Samsung mobile phone as a competitor. Nokia has offered the N-Series category, for an example the N82 which is said to be the successor to the top end. Also N82 has a lot of additional features which were not available in N73. N95 and N73 were 2 of the most popular N-Series phone.
Samsung mobile company is determined as a monopolistic competition by our team, because Samsung mobile company has the characteristics of a monopolistic competition. Monopolistic competition is defined as an imperfect competition referring to a market structure that falls between perfect competition and pure monopoly. In addition, in mobile industries, there exist many sellers like perfect competition, but products are not exactly same; each product differs from others. This means that all mobile phones has the same main functions like phone calls and sending messages, but each firm merely develops its own design and functions for attracting consumers to purchase its product and making difference from other firm’s products.
If our chosen company Samsung Mobile were to cut production, we think that the price would rise but the revenue will not necessarily rise in a short run. The reason is because according to the graph, it tells us the supply curve will shift to the left when company cut production. On the other hand, in the long-run as new advanced models emerge in mobile phone market, people would be more attracted to buy the new models than the old models of Samsung. For this reason, in the long-run the demand curve will shift...