Market StructuresEast-West Transportation, Inc. operates primarily in the eastern regions of the United States. East-West Transportation's four primary divisions are the Consumer Goods Division, the Coal Division, the Chemicals Division and the Forestry Products Division. With the help of consulting firm Brighton, Young and Roy, Inc. (BYR) and Peter Schultz, Senior Vice President, Strategic Planning, of East West Transportation, the various divisions and market situations will be reviewed allowing for the formation of future business strategies (University of Phoenix, 2003). Perfect Competition East-West Transportation's Consumer Goods Division operates in a perfectly competitive market. “Perfect competition is characterized by many buyers and sellers, many products of similar nature, and, consequently, many substitutes” (Investopedia, 2007). The dilemma facing the Consumer Goods Division is the growing and continuing losses for this division. The decision under consideration for this division is whether to close or allow continuation while reducing or minimizing losses. In a perfectly competitive market, companies freely enter and exit the industry without government restrictions or regulations. Since the number of sellers and buyers is large, no one can individually influence or set the market price. The demand curve for a perfectly competitive firm is horizontal or a perfectly elastic demand curve. Price is not related to the quantity of output produced or quantity sold, so price equals marginal cost and marginal revenue (AmosWeb Encyclonomic, 2007). To maximize profit, an entity produces the quantity of output that generates marginal costs equal to marginal revenues. When marginal revenues are greater than marginal costs a firm can increase profit by increasing production; when marginal revenue is less than marginal costs a company should decrease production (Colander, 2004, 248). The Consumer Goods Division suffers losses at every level of production; there is the possibility of recovering variable costs with the continuation of the division's activity. If the business ceased, there would be losses equal to the fixed costs, which are greater than continuing the business. Adjusting production will minimize losses if production is at a level where price equals marginal revenue equals marginal costs (University of Phoenix, 2003). Monopoly By shutting down Fast Forward Transport, it gives East-West Transportation a regional monopoly in the coal transportation business. A monopoly is “a market structure characterized by a single seller of a unique product with no close substitutes” (AmosWeb Encyclonomic, 2007). Now that East-West Transportation holds a coal monopoly in the region, service pricing requires determination and analysis of whether services need to be increased or decreased to meet market demand..