Market structures1-rev

Market structures1-rev - Marketstructures...

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Market structures 1.Perfect Competition 2. Monopoly 3. Oligopoly 4. Monopolistic Competition
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Determinants of market structure Number of sellers Nature of the product – homogenous  (identical), differentiated? Freedom of entry and exit Control over price Non price Competition
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Types of profit  : Economic profit  is Total Revenue less explicit  and implicit costs. Accounting profit  is total revenue less explicit  costs Normal profit  is an implicit cost which the  opportunity cost for the entrepreneur – the  return that he could have earned in the next  best alternative.
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Features of the four market structures
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Perfect Competition: Free entry and exit to industry Homogenous product – identical - no  consumer preference Large number of buyers and sellers – no  individual seller can influence price Sellers are price takers – have to accept  the market price Perfect information available to buyers and  sellers
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This note was uploaded on 01/27/2012 for the course ECONOMICS SLEC501 taught by Professor Smohe during the Spring '11 term at IBS DE.

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Market structures1-rev - Marketstructures...

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