Eco/561 Business Proposal Nattatida Dumrongpalasit

Business ProposalNattatida DumrongpalasitECO/561September 30, 2013Maria Hamideh RamjerdiBusiness ProposalProduct selected: Oral-B Pro-Health toothpasteProcter & Gamble (P&G) had recently announced its entry into the toothpaste market in India with launch of its Oral-B Pro-Health brand. The industry for toothpastes is an example of monopolistic competitive market structure. A monopolistic competitive market is characterized by a large number of buyers and sellers and each seller having a certain degree of monopoly power. Thus this market structure is a mixture of both monopoly and perfect competition. The main characteristics of a monopolistically competitive market are: Product differentiation: In a monopolistically competitive market, the firms sell products which are almost similar in characteristics, but not identical. This is known as product differentiation.Free entry and exit: A monopolistically competitive market is characterized by free entry and exit.Advertisement: Advertisement is also another important feature of this market. Every firm under this market structure has to incur advertisement cost to highlight their product to their customers. Thus there is a large practice of non-price competition.There are many toothpaste companies in the country. The