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market structure summary

market structure summary - Features There are many firms...

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Long Run Equilibrium in Pure Competition Features: Many firms produce a standardized product. There is free entry and exit. Firms are price takers. Firms earn no economic profit in the long run. P Q D S Q $ MC ATC AVC = e f D p MR AR = = =
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Long Run Equilibrium for a Monopoly Features: There is one firm producing a unique product. There are significant barriers to entry. The monopolist has market power. (They can significantly influence market price.) A monopolist has potential for economic profit in the long run. Q $ MC ATC AVC = D AR = MR Profit
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Long Run Equilibrium in Monopolistic Competition
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Unformatted text preview: Features: There are many firms producing a slightly differentiated product. Firms have some market power in that they face a downward sloping demand curve. There is free entry and exit from the industry. A monopolistically competitive firm will earn no economic profit in the long run. Firms don’t produce at the minimum point of the long run ATC curve, they allow some “excess capacity.” Q $ MC ATC AVC = D AR = MR...
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market structure summary - Features There are many firms...

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