Market Structures Of The Market

There are different types of market structures. For example, pure competition market structure with many sellers and products that are standardized. Monopolistic competition entails firms selling similar products but not identical. Many sellers compete for buyers. Oligopoly another market structures where few firms dominate. Monopolies are the single entity that supplies the market. It is when Monophony has more buyers than sellers controlling the market. The Grapes of Wrath by John Steinbeck provides excellent data. Through the farmers, decision from the banks and in farms it explores the market

The following case study is in regards of economic market structure. In the world of economics all businesses or companies rather, are categorized in certain market structures such as monopoly, oligopoly, or perfect competition, for instance, the market structure for restaurants. Most restaurants are considered monopolistic competition. Being that they all sell and serve food. They have to have instances that vary such as price, logos, servers, locations, décor, types of food, and hospitality.

An oligopolistic market is one that has several dominant firms with the power to influence the market they are in; an example of this could be the supermarket industry which is dominated by several firms such as Tesco, Sainsbury’s, and Waitrose etc... Furthermore an oligopolistic market can be defined in terms of its structure and its conduct, which involve various different aspects of economics.

Individual firm’s market share is tiny compared to the other three market powers, such as monopolistic, oligopoly, and pure monopoly. In a perfect competition system the type of products are homogenous, so each competitor would be selling the same product or service. There is also no barrier to entry so firms can enter and exit the market freely without barriers from regulation or cost.

Firm under perfect competition and the firm under monopoly are similar as the aim of both the seller is to maximize profit and to minimize loss. The equilibrium position followed by both the monopoly and perfect competition is MR = MC. Despite their similarities, these two forms of market organization differ from each other in respect of price-cost-output. There are many points of difference which are noted below.

Two different market structures are monopoly and oligopoly. Oligopoly is a type of monopoly but isn’t exactly the same. Monopoly is the structure that most businesses have which doesn’t have much competition. Oligopoly is a rather difficult business structure for new companies to join.

1. Describe each market structure discussed in the course (perfect competition, monopolistic competition, oligopoly, and monopoly) and discuss two of the market characteristics of each market structure.

There are four types of market structures: Monopolistic Competition, Monopoly, Oligopoly, and Perfect Competition. Monopolistic Competition is also known as competitive market. In this market structure, there are a large number of firms that produce similar but somewhat differentiated products for the same target customers. The market share is also divided among large number of firms making it difficult for one firm to become the market leader. On the other hand, Monopoly is a type of market structure in which only one firm controls the whole industry. There are strict barriers to entry for new firms due to governmental restrictions or the monopolistic power of the firm itself. In Oligopoly, the whole industry is dominated by a few large scale firms that set prices, introduce innovative products, and use heavy campaigns to attract buyers. All other small scale firms follow the changing market patterns set by these oligopolistic firms. Lastly, perfect competition is a market structure in which there are a larger number of firms that produce similar as well as differentiated products for

Market structure is the physical characteristics of the market within which companies react. This means that there are different kinds of market structure based on how companies work together within a particular industry. Location and product have the most to do with determining the market structure. There are four defined market types. The first market structure is called the perfectly competitive market. The second market is called a monopoly market structure. The third market is called monopolistic competition market structure. The final market is called oligopoly market structure. Each market structure is different and both benefits and disadvantages

Market structure refers to the important features that determine the level of competition in an industry. These factors include (a) the number of buyers and sellers, (b) the products degree of uniformity, (c) the ease with which new firms enter or old firms exit the market, and (d) the ways in which firms in the industry compete with each othersuch as through prices or advertising.

The organization and characteristics of a specific market where a company operates is referred to as market structure. While markets can basically be classified by their degree of competitiveness and pricing, there are four types of markets i.e. perfect competition, monopolistic competition, monopoly, and oligopoly. In perfect competition markets, many firms are price takers whereas monopolistic competition markets are characterized by the ability of some firms to have market power. In contrast, oligopoly markets are those in which few firms can be price makers while monopoly market is where one firm can be a price maker.

There are four widely recognizable types of markets: competition, perfect competition, monopolistic, and oligopolistic. The differences between these types of markets are dependent upon the

•Oligopoly: This is an industry with very little firms in the market. If they conspire, they weaken output and raise profits the way a monopoly would and should do. For example the mobile phone industry is an oligopoly what with so many companies for example Apple, LG and Samsung all competing together. Supermarkets are oligopoly’s as they make supernormal profits as well.

Different market structures are basically compared by the number of competing firms and the extent of entry barriers.

One step away from perfect competition is monopolistic competition. This type of market structure has a number of different characteristics from the above. Which turn it into one of the most used market structures. In this scenario, companies are not all price takers and start making use of economies of scale in order to improve efficiency, reduce costs and increase profits. In the scenario companies sell a differentiated product at different prices. Like in perfect competition no barriers are put to entry and newcomers a constant threat to the market keeping every player always in search for a better mean to produce and compete.