Market structures

Question 1

what are the 4 main types of market structures

Answer 1

Monopoly
oligopoly
monopolistic
perfect competition

Question 2

How does competition help

Answer 2

Competition increases as the number of businesses in the market increase

Question 3

What is monopoly

Answer 3

a single producer within a market
- 100%of the market is now very rare
Uk and EU competition authoroties will investigate situaion where they beleive power is being abused
- advantage to customers, economies of scale
-Erect barriers
-price markets

Question 4

Oligopoly

Answer 4

Only a few dominate the market
- storng brand identity
-brand loyalty , heavy advertising
-short price wars can occur
-some barriers to entry
when a business act together a cartel is formed, cartel try to keep prices high

Question 5

Monopolistic

Answer 5

A large number of relatively small businesses in competition with each other
- few barriers to entry
-products are similar but differentiate from each other
- brand identity relatively weak
-not price takers , limited degree of control over the price they charge

Question 6

Perfect competition

Answer 6

-Large number of businesses
-price takers
-goods sold are homegoods
-equal access to technology
-full market info
-no barriers to entry or exit