Brian+Shin+Project

=Monopoly of the Vending Machine at the Soccer Field of KIS = 


==== School is definitely not an exception. Opportunity costs, negative externalities, positive externalities, elasticity, the circular flow, and many kinds of markets can all be observed in school. Out of all of those, I want to talk about the monopoly that remains in school, the vending machine at the soccer field. ====

Definitions


Vending Machine?
 ==== According to the dictionary in my Mac, a vending machine is a machine that dispenses small articles such as food, drinks, or cigarettes when a coin, bill or token is inserted. It’s a machine that dispenses small articles such as food, drinks, or cigarettes when a coin, bill or token is inserted. ====

Monopoly?
 ==== According to the principles of Microeconomics, a firm is a monopoly if it is the sole seller of its product and if its product does not have close substitutes. ====

How can I tell that monopoly’s occurring at the soccer field?
 ==== One of the key characteristics of a monopoly is that a main resource is owned by a single firm, not a whole market. Monopolies lack economic competition for the certain good or service that they provide. Also there isn't a practical substitute for the consumers to buy instead of the good provided by the monopolies. In this case, the vending machine at the soccer field owns the key resources, which are the drinks. ====


====<span style="font-family: 'Comic Sans MS',cursive;"> People tell the soccer players to get their drinks at the cafeteria. However, boys, who usually get late practice, play soccer until 6 and the cafeteria closes at 5. ====

<span style="font-family: 'Comic Sans MS',cursive;">
====<span style="font-family: 'Comic Sans MS',cursive;"> Then, why don’t we buy the drinks before practice? Think about it, if you ever played a sport until the point you get exhausted, you’ll definitely prefer a cold drink over a warm one. If we buy the drinks from the cafeteria or somewhere else before practice, we won’t be able to keep it cool, thus will have to drink it warm, which is something we don’t want to do. ====

<span style="font-family: 'Comic Sans MS',cursive;">
====<span style="font-family: 'Comic Sans MS',cursive;"> I think this one can be considered as a natural monopoly since it will be inefficient to put more than one vending machine in each area. It will cost more even though the profit it makes won't change. One vending machine will be able to supply drinks to people at a smaller cost than could two or more vending machines. ====

<span style="font-family: 'Comic Sans MS',cursive;">
<span style="font-family: 'Comic Sans MS',cursive;"> __DRINKS ARE ESSENTIAL AFTER PLAYING A SPORT__

<span style="font-family: 'Comic Sans MS',cursive; color: rgb(255, 0, 0);">Issue
====<span style="font-family: 'Comic Sans MS',cursive;">The price of the drinks used to be from 600 won to 800 won. However, it has been raised 200 won each so now the cheapest one is 800 won and the most expensive one is 1000 won. It sucks to pay that amount just for a can. ====

<span style="font-family: 'Comic Sans MS',cursive;">
====<span style="font-family: 'Comic Sans MS',cursive;"> For example, the lemonade and grapefruit-ade sold by the vending machine costs 600 won in normal shops anywhere in Korea. However, it used to be 800 won in the vending machine, which is 200 won more expensive than its original price, and now it’s 1000 won which almost twice its original price. The seller is surely taking advantage out of his position as a monopolist. ====

<span style="font-family: 'Comic Sans MS',cursive;">
====<span style="font-family: 'Comic Sans MS',cursive;"> Since the demand curve of a monopolist is downward-sloping, unlike the competitive firm’s horizontal curve, as the price was risen, the demand for it sort of decreased. As shown in the graph below, as demand decreases, the marginal revenue the seller earns decreases. However, the demand for athletes and coaches who just played soccer for 2 hours is still high, so they still purchase the drinks despite its unbelievably high price. ====

The vending machine owner won't experience any price pressure since he has no competition.
<span style="font-family: 'Comic Sans MS',cursive;">

====Whoever owns the vending machine seems to be a clever economist because he knows that he's the only supplier, which gives him the power to change the price to whatever he wants and I hate him for that.====