03.12 Market Structure Summary Sheet

03.12 Market Structure Summary Sheet - High barriers for...

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Market Structure Summary Sheet <-- --------Characteristics -------- --> <-- --------Performance -------- --> Efficiency? Economic Profit Market Type # of sellers Mkt Conct. Ratio Product Differentiation Barriers to entry? Gov. Reg. of Price? Economic Allocative Short Run? Long Run? Example Perfect Competition A large amount Very Small None, the firm sells an identical product, no advertising No barriers None, firm is a "price taker" Yes Yes Yes, only in short- run No Agriculture comes close Monopolistic Competition Many small sellers Small Yes, the products are similar though Very low barriers, easy entry/exit No No No Yes No, profits will be "competed away" by new firms Local retail fast food, gasoline, hair stylists, etc. Undifferentiated Oligopoly Few sellers High No
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Unformatted text preview: High barriers for entry and exit No govt. price regulation No No Yes Yes Steel, contract construction Differentiated Oligopoly Few sellers High Yes High barriers No govt. price regulation No, price not at min. of ATC No Yes Yes Beer, soft drinks, vehicles, etc. Natural Monopoly Company Only one seller Absolute None, the firm is the only seller Complete barriers to entry Yes, state/ local govt. regulates price No Possible, depends on how price is regulated No No Local electric power Pure Monopoly Only one seller Absolute None, the firm is the only seller Complete barriers to entry None, but firm has some pricing freedom No No Possible Yes Alcoa (historic) many firms in small, local mkts....
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