Perfect Competition Market - Equilibrium

Meaning and Definition of Market Market generally means a place or a geographical area, where buyers with money and sellers with their goods meet to exchange goods for money. In Economics market refers to a group of buyers and sellers who involve in the transaction of commodities and services.
Characteristics of a market
1. Existence of buyers and sellers of the commodity.
2. The establishment of contact between the buyers and sellers. Distance is of no consideration if buyers and sellers could contact each other through the available communication system like telephone, agents, letter correspondence and Internet.
3. Buyers and sellers deal with the same commodity or variety. Since the market in economics is identified on the basis of the commodity, similarity of the product is very essential.
4. There should be a price for the commodity bought and sold in the market.
Classification of Markets
A) Market according to Area
Based on the extent of the market for any product, markets can be classified into local regional, national and international markets.
Local Market
A local market for a product exists when buyers and sellers of commodity carry on business in a particular locality or village or area where the demand and supply conditions are influenced by local conditions only. E.g. Perishable goods like milk and vegetables and bulky articles like bricks and stones.
National Market
When commodities are demanded and supplied throughout the country, there is national market
e.g. wheat, rice or cotton
Regional Market
Commodities that are demanded and supplied over a region have regional market.
Global Market
When demand and supply conditions are influenced at the global level, we have international market. e.g. gold, silver, cell phone etc.
On the basis of demand and supply, this geographical classification is made. With improved transport facilities and communications, even goods of local markets can become international goods.
B) Market according