Chapters+6++10-11-2006+

Chapters+6++10-11-2006+ - Chapter6 Competition Fall2006 1...

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Fall 2006 1 Chapter 6 Competition Competition
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Fall 2006 Chapter 6 – Slide 2 Perfect Competition A perfectly competitive market contains  many sellers and many buyers, none of  whom can influence the price of the  product
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Fall 2006 Chapter 6 – Slide 3 Supplier’s Decision in a Perfectly  Competitive Market Suppliers in a competitive market make  their supply decisions in a situation where  output prices and input prices are taken as  given  Given the prices of input factors and  product output, suppliers must decide 1. Should they produce at all? 2. If yes, how much should they produce?
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Fall 2006 Chapter 6 – Slide 4 Perfectly Competitive Firms A perfectly competitive firm cannot  influence the price of its output --- It takes  the price of its output as given The quantity of the products a competitive  firm sells does not impact the price
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Fall 2006 Chapter 6 – Slide 5 The Competitive Firm’s Demand Quantity $ Price P1 Demand  Curve
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Fall 2006 Chapter 6 – Slide 6 A Competitive Market P1= Equilibrium market clearing price Price (per unit) Quantity demanded p 1 q 1 Market  Supply  Market  Demand 
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This note was uploaded on 02/12/2010 for the course ECON 62000 taught by Professor Freed during the Spring '07 term at UC Irvine.

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Chapters+6++10-11-2006+ - Chapter6 Competition Fall2006 1...

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