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contestable market

Member rating: No Rating | Words: 880 | Submitted: Mon Jun 11 2007

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Is Tesco's Contestable? A contestable market is when they are no costs for businesses who are wishing to enter and exit their market. So in the oligopoly market that's Tesco's and their rivals businesses are in, they wouldn't be considered "contestable" because it would cost many businesses wanting to enter the market a lot of money. The reason is because many businesses nowadays, their main aim is for them to be the market leader, as Tesco's are at present. Several years back when Tesco's first broke into the market, there weren't many competitors competing with them, so they were gaining all the attention in terms of revenue and profit. So this would mean that Tesco's was a monopoly so businesses wishing to enter the market then, would be that they had a costless barriers to entry because of Tesco's only being in the market at that time. That, I...

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