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The three important market structures in economics are competitive markets, monopolies, and oligopolies. Each market plays a different role in the economy. Competitive markets are when no firm has the power to affect the market price of a good and “many buyers and sellers trading identical products so that each buyer and seller is a price taker” (Mankiw, 290). A monopolistic market is when a specific person or enterprise is the only supplier of a certain good. An oligopoly is a market in which a good has only a few “similar or identical” (Mankiw, 346) products for sale.…
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Perfect competition is the situation in a market (based on six assumptions), (1) where the elements of a monopoly are non-existent, (2) consisting of numerous buyers and sellers, (3) the market price of commodities are beyond the control of individual sellers and buyers, (4) perfectly competitive firms produce homogeneous products, (5) there is free entry into the market and free exit out of the market, and lastly (6) there is perfect knowledge. If these six assumptions are met, the market will be perfectly competitive.…
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“Competitive market is many sellers that sell similar products with very little control over the market selling price.” A competitive market achieves efficiency in the allocation of scarce resources if no other market failures are present. The competitive market does very well because of the demand price and supply price are equal. The demand and supply prices cannot generate any greater satisfaction by producing more of one good and less of another. The characteristics of competitive market are: number of firms in the market, control over the price of the relevant product and the type of product sold in the market. An example of competitive market structure is a gas station. There can be many gas stations in a certain mile radius, but the more gas stations there are in a small area, then the higher the competitive market.…
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Perfect competition is described as a market structure where competition us at its greatest possible level. The four key characteristics of perfect competition are multiple firms in…
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Topic: 1.12 - Looking at Perfect Competition 60.00% Competency: 3002.1.13 Understanding Monopoly Markets 3.0/5.0 points Topic: 1.13 - Understanding Monopoly Markets 80.00% Competency: 3002.1.14 Monopolistic Competition and Oligopoly 4.0/5.0 points Topic: 1.14 - Monopolistic Competition and Oligopoly 100.00% Competency: 3002.1.15 Distribution of Income 5.0/5.0 points Topic: 1.15 - Distribution of Income…
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Competition in the Market The laws of supply and demand are bestevident in a competitive market. ThinkQuest : Library. Retrieved November 11, 2012, from http://library.thinkquest.org/C008486F/iiid.htm…
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Perfect competition requires a market structure with freedom for firms to enter or leave the market.…
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and writs of quo warranto are some of the actions states take for those who commit UPL.…
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Text materials Amacher, R., & Pate, J. (2013) chapter 9 expound on the characteristic of perfect competition. the text stretches the importance of the six basic assumptions for the model of perfect competition which are large number of sellers, large number of buyers, homogeneous product, free entry into and free exit out of the market, and resources can easily move in and out of the industry. These six assumptions is a must, for perfect competition to exist. Unfortunately in our world ,it is very difficult for perfect competition to exist, but there are market that comes close, for example currency market would be close to perfect competition. Same product, many sellers and buyers, the down side is the market can be influences by external factors. High entry barriers would make profit difficult, long run equilibrium with perfect competition would be affected. It also means all firms would not be at the optimal size, unable to combined variable resources efficiently. There are competitive pressure when it comes to high barrier to entry in perfect competition, when it is difficult to get in a competitive market, firms create clever way to get in and sometime that involve corruption, for example, the taxi cab industry.…
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There are different classifications of markets and the structure of a business determines which classification it will fall into. Markets are divided according to the composition of the business and what it provides to the specific market. Business composition is determined by the structure of market characteristics, and this helps determine level and area of competition. The characteristics in a market with the most concentration focus on number of purchasers and retailers, level in which a product has a substitute, price, entry and exit ease, and the level of mutual dependence. These structured variables are classified in the following market structures: perfectly competitive markets, monopolistically competitive markets, monopolies, and oligopolies (Colander, 2010).…
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This is a Perfect Competition Market. There are many sellers and buyers, product is standardized and there are almost no entry or exit barriers.…
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References: Brown, K. (2010, December). An explanation and analysis of market and market structures to include monopolies, oligopolies, monopolistic, and pure competition. Retrieved from http://www.suite101.com/article/the-market-a322381…
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The Great Depression of the 1930s was by far the greatest economic catastrophe in the history of the United States. The collapse of the economy was a devastating blow to the national morale and left the nation in financial ruins. In 1931, Franklin Delano Roosevelt was elected president on campaign promises to restore jobs and prosperity to the country. His proposal, the New Deal, fundamentally changed the nation. The New Deal affected the country by providing jobs and was to be a means of giving the nation a sense of hope. However, despite the positive actions that took place, the New Deal did not fix the job unemployment problems nor did the economy improve to pre Depression levels until many years after the New Deal was initiated.…
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1. Under perfect competition, there are many small firms, each producing an identical product and each too small to affect the market price.…
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A perfectly competitive market is a hypothetical market where competition is at its greatest possible level. Neo-classical economists argued that perfect competition would produce the best possible outcomes for consumers, and society. Ex:- Wheat, rice…
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