monopolistic_competition

Intermediate Microeconomics: A Modern Approach, Seventh Edition

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Unformatted text preview: Monopolistic Competition Market Structures - Review ◆ Competitive: many firms, identical products ◆ Monopoly: single firm, no close substitutes ◆ Oligopoly: several firms, similar products, degree of product differentiation varies depending upon the market ◆ Monopolistic competition: many firms, similar products, slightly differentiated products Competitive Market ◆ This is the classic “textbook” market structure. ◆ Firms in a competitive market all make a product that is perfectly substitutable: all demanders are equally satisfied with any supplier’s product. Firms are price takers. ◆ Hot dogs! Monopoly ◆ The single seller makes a product that has no good substitute. ◆ Other firms may be able to produce the good or service but choose not to enter the market or are barred from it. Firms are price makers. ◆ Some pharmaceuticals Oligopoly ◆ A few sellers make products that are good, but not perfect, substitutes....
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monopolistic_competition - Monopolistic Competition Market...

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