Chapter 8 - Chapter 8 Market structure establishes Four...

This preview shows page 1 - 2 out of 2 pages.

Chapter 8 09/25/13 Market structure: establishes… Four market classifications: 1. Perfect (pure) competition 2. Monopolistic competition 3. Oligopoly 4. Pure monopoly Characteristics of perfect competition 1. Many buyers and sellers—price-takers, no one buyer or seller can influence the market price 2. All firms produce a homogenous product—easy to find substitutes EX: wheat grows in Kansas vs wheat grown somewhere else 3. No barriers to enter or exit market 4. All economic agents possess perfect information—consumers and firms can make informed choices For perfect competition, price is determined in the market: SEE HANDWRITTEN NOTES FOR GRAPH Factors that shift demand: 1. Number of purchasers: More purchasers, more demand 2. Consumer tastes Increase in demand if advertising gets greater 3. Income Normal good? Inferior good? 4. Prices of related goods Substitutes? Complements?
Image of page 1

Subscribe to view the full document.

Image of page 2

{[ snackBarMessage ]}

What students are saying

  • Left Quote Icon

    As a current student on this bumpy collegiate pathway, I stumbled upon Course Hero, where I can find study resources for nearly all my courses, get online help from tutors 24/7, and even share my old projects, papers, and lecture notes with other students.

    Student Picture

    Kiran Temple University Fox School of Business ‘17, Course Hero Intern

  • Left Quote Icon

    I cannot even describe how much Course Hero helped me this summer. It’s truly become something I can always rely on and help me. In the end, I was not only able to survive summer classes, but I was able to thrive thanks to Course Hero.

    Student Picture

    Dana University of Pennsylvania ‘17, Course Hero Intern

  • Left Quote Icon

    The ability to access any university’s resources through Course Hero proved invaluable in my case. I was behind on Tulane coursework and actually used UCLA’s materials to help me move forward and get everything together on time.

    Student Picture

    Jill Tulane University ‘16, Course Hero Intern