Forms of Industrial OrganizationConsumers are faced every day with decisions about which product to purchase. Unless consumers have a personal preference as to which product to purchase, they tend to base their purchasing decisions on price. Manufacturers control prices based on supply and demand, but other factors come into play when companies decide how much to charge consumers. The presence of monopolies, oligopolies, monopolistic competition and perfect competition allows manufacturers to manage prices accordingly. This article will provide an example company for each of the four market situations and how prices are affected by a company's status in these markets. Pure competition Pure competition is defined as “the presence of a large number of companies producing a standardized product (which is to say a product identical to that of other producers…). New companies can enter or exit the industry very easily. (McConnell, p. 413) Pure competition, although very rare, is generally found in markets that sell agricultural products, fishing products, currencies, base metals and stocks (McConnell, p. 415 ). The fast food industry is emerging to align with McConnell's view. When looking at this industry and specifically McDonald's Corporation, we see the presence of many organizations (Burger King, Jack in the Box, Hardees, and Wendy's) all of which produce standardized products (such as fries, hamburgers). McDonald's pays particular attention to its pricing strategy. because they operate in a very volatile market (i.e. dollar menus, value meals, family meals). For example, McDonald's partnered with the Seminole County (Florida) school board to establish a program for its 27,000 elementary school children. For the 2007-2008 fiscal year, children enrolled in this program will take home 4 report cards during this period. Because "children who get all A's and B's, who have two or fewer absences or who demonstrate good behavior are entitled to a free Happy Meal at a local McDonald's, provided they present their school report." (York, Emily Bryson) With the fast food industry under constant pressure from healthcare leaders, McDonald's Corporation and its franchisees must constantly rethink their pricing and marketing strategy by improving their menus (e.g. salads, fruit, milk). McDonald's pricing strategy is closely related to the law of demand, which means that it depends on the spending trend of its customers. Oligopoly An oligopoly is “a market dominated by a few large producers of a homogeneous or differentiated product” (McConnell & Brue 2004).