Short answers, pulled from the story.
In economics, competition is a scenario where different firms contend to obtain limited goods by varying elements of the marketing mix: price, product, promotion, and place. The greater the selection of a good in a market, the lower prices typically are compared to monopoly or oligopoly conditions. Competition results from scarcity and occurs when people strive to meet the criteria determining who gets what.
Perfect competition is a theoretical market state where all firms sell identical products, act as price takers, have perfect information, and earn zero economic profit in the long run. Imperfect competition describes realistic markets where firms sell differentiated products, set their own prices, and may be protected by barriers to entry. Monopoly, oligopoly, and monopolistic competition are all forms of imperfect competition.
A natural monopoly arises due to high start-up costs or powerful economies of scale in a specific industry, making it efficient for only one firm to operate. These monopolies typically form in industries requiring unique raw materials, specialized technology, or significant fixed asset investment. Natural monopolies are often publicly provided or tightly regulated because producing enough competing firms to create competition may itself be inefficient.
A 65% increase in the exchange value of the US dollar in the early 1980s effectively taxed American exports and subsidized foreign imports, while Federal Reserve anti-inflationary measures raised interest rates. By 1984, the manufacturing sector faced import penetration rates of 25%. The recession of 1979-82 failed to slow imports as usual because the strong dollar kept the US market attractive to foreign producers throughout the downturn.
The Omnibus Foreign Trade and Competitiveness Act of 1988, originally introduced by Representative Dick Gephardt and signed by President Reagan, aimed to strengthen America's ability to compete globally. Section 301 gave the United States authority to respond to foreign governments that violated trade agreements or maintained unreasonable trade barriers, including through a sub-provision protecting intellectual property rights. President Clinton renewed the act in 1994 and again in 1999.
Economists measure competition by the number of rivals in a market, their similarity in size, and the share of industry output held by the largest firm. The smaller that largest firm's share, the more vigorous competition tends to be. Effective competition is said to exist when there are four firms with market share below 40%, flexible pricing, low entry barriers, little collusion, and low profit rates.