Perfect Competition : The Market Price Of An Product

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.

Oligopolies are a type of market structure evident in Australia, which is comprised of 2 or more firms having a significant share of the market. In an oligopoly the few firms sell similar but differentiated or homogenous products and is characterised by a large number of buyers making it a form of imperfect competition. This market structure is evident through the Big Four Banks, Phone Industry - Vodafone, Optus and Telstra.

In a perfect competition substitutes are abundant and to stay competitive one will need to offer the lowest possible price. In monopolistic competition, the differentiation is based on quality and competitive advantage. Substitutes are not as readily available so a consumer will likely decide on the better value that comes with better quality.

An Oligopoly refers to a market structure where-by the suppliers have formed some form of cartel and are acting in unison. In such a case the suppliers have the power to determine the price of the commodity and may set any price.

Perfect competition is a market structure characterized by many buyers and sellers of a standard product. This is an ideal form of competition with easy entry to and exit from the industry. Although this type of market is easy to entre, it is important to keep in mind that private competitors hold no market power, because of its role as a ‘price-taker’. A good example of perfect competition is agriculture, which would include dairy farming and production. Perfect competition market price is determined by the equilibrium between demand and supply in a given ‘market period’.

Monopolistic competition is defined as an industry with players offering unique differentiated products. But because of many close substitutes demand for this product is very elastic. These close substitutes are competition for a company.

At one end is perfect competition where there are very many firms competing against each other. Every firm is so tiny in relation to the entire trade that has no power to manipulate price. It is a ‘price taker’. At the other end is monopoly, where there is just a single firm in the industry, and for this reason no competition from inside the industry.

An oligopoly is a market situation (or industry) in which there are few sellers. These sellers are

Oligopoly refers to the market situation that would lie between pure competition and monopoly. It is characterized by small group of firms that control the market for a certain product or service. This gives these businesses huge influence over price and other aspects of the market.

Monopolistically competitive markets are those that involve industries such as clothing, eateries, footwear, as well as in the service area. A monopolistically competitive market can be characterized as having an abundant amount of both manufacturers and consumers, consumer’s preferences for purchasing is known; survival in this area consists of the seller trying to distinguish specific products from competitors. A monopolistically competitive market could

Oligopoly Oligopoly is a market structure in which the number of sellers is small. Oligopoly requires strategic thinking, unlike perfect competition, monopoly, and monopolistic competition. • Under perfect competition, monopoly, and monopolistic competition, a seller faces a well defined demand curve for its output, and should choose the quantity where MR=MC. The seller does not worry about how other sellers will react, because either the seller is negligibly small, or already a monopoly. Under oligopoly, a seller is big enough to affect the market. You must respond to your rivals’ choices, but your rivals are responding to your choices.

•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.

Aggressive business owning, buying up your competitors or distributors to maximize a company’s profit, running a business with no competition. Webster’s defines a monopoly as “exclusive ownership through legal privilege, command of supply, or concerted action” or “a commodity controlled by one party”. A clear example of what a monopoly is as simple as the board game Monopoly, the game is played exactly what the name says it is, the player becomes a Monopoly, buying up multiple companies that are related in some way to maximize the most money that play can gain from those businesses. Monopolies are quite simple, take for example, there is a local company that makes car parts out of steel, the company purchases the stock steel from a factory that makes steel stock. To make the steel stock the steel stock company buys the raw materials from a mining company. If the car parts company wants to maximize their profits, they simply buy up the steel company. That way they are not over charged for the steel stock and can get it at a low rate. If the wanted to further maximize their profits they would buy the mining company as well, giving the car parts company total control of where their supply came from and control of the cost, this is called vertical integration. There are two types of monopolies: vertical monopoly and horizontal monopoly. Vertical monopoly or vertical integration is buying up the companies that are a part of the whole manufacturing process. Examples

An oligopoly is a section of the market in which only a handful of firms dominate the majority of the market share. Examples of this would be Coles and

“In a perfectly competitive market all participating producers and consumers are price-takers” (Krugman & Wells 1). As stated by Paul Krugman and Robin Wells, in a perfectly competitive market “neither consumption decisions by individual producers affect the market price of the good” (Krugman & Wells 1). “There are two necessary conditions for perfect competition, the first being that none of the producers have a large market share, and the second being that the goods produced are being regarded as a