3:4:1 Market Structures Flashcards
(264 cards)
What is the order of the Most to Least competitive market structures?
- Perfect Competition (most competitive)
- Monopolistic Competition
- Oligopoly
- Monopoly (Least Competitive)
What Market Structures have imperfect competition?
- Monopolistic Competition
- Oligopoly
- Monopoly
What determines the output and price of a firm?
COMPETITION in the market
What is the rule to tell if a market is an Oligopoly?
F-rule If FIVE or FEWER FIRMS have 50% market share, the market is highly concentrated and has characteristics of an Oligopoly
In highly concentrated markets [……] firms dominate
Few firms dominate
Define the Concentration Ratio?
Is the market share controlled by a certain amount (n) of the largest firms
Example - What is the Four-Firm concentration ratio?
Is the market share controlled by the four largest firms in the industry
What would the concentration ratio of an Oligopoly and Monopoly be?
- Oligopoly - Highly concentrated - Monopoly - Low concentration ratio
How many firms/its market concentration does a perfectly competitive market structure have?
Number of firms – many small firms Market concentration – low concentration
How many firms/its market concentration does a Monopolistic competitive Market have?
Number of firms – one large firm – high concentration - 1 firm has 100%
How many firms/its market concentration does an oligopoly market structure have?
Number of firms – a few large firms dominate Market concentration – high concentration
How many firms/its market concentration does a monopoly market have?
One firm has 100% concentration ratio
What type of product do perfectly competitive market sell?
Homogeneous (the same type of products)
What kind of product do monopolistic Competition markets have?
Similar products
What type of product to oligopolistic markets sell?
Similar
What type of products do monopolistic market sell?
Unique products
What kind of knowledge do firms have in perfectly competitive markets?
Perfect information
What kind of knowledge do firms have in monopolistic competition market structures?
Imperfect information
What kind of knowledge do firms have in oligopoly markets have?
Imperfect information
What kind of knowledge do consumers in monopoly market structures have?
Imperfect information
What are the barriers to entry/exit of a perfectly competitive market like?
No barriers to entry/Exit
What kind of barriers to entry/exit are there in monopolistic competition market structures?
Low barriers to entry/exit
What kind of barriers to entry/exit are there in oligopoly market structures?
Hi barriers to entry/exit
What kind of barriers to entry/exit are there in monopoly market structures?
Hi barriers to entry/exit





