abstract:A price umbrella, also known as the umbrella effect, is a pricing effect often created by a dominant company, in which competing firms can find buyers as long as they set their price at or below the level of the dominant one. This may not apply if the competing firm's products are inferior.
It appears that Monsanto has clung to two-thirds of the business, cutting prices reluctantly and thus leaving a priceumbrella for the first discounters.
That was fine when the priceumbrella provided by full-rate brokers allowed Schwab to post 1.2 cents in revenue annually on every dollar of retail assets.
So Amazon will undoubtedly continue to aggressively price its tablets at around the cost of making them, thereby creating an extremely low priceumbrella for everything but the newest iPads.