Submitted by: Submitted by tallyfran
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Category: Business and Industry
Date Submitted: 05/23/2011 10:26 AM
Define and distinguish between the 4 types of markets recognized by economists. What kind of market is the internet at this time?
. Pure Competition
• Monopolistic Competition
• Oligopolistic Competition
• Pure Monopoly
Pure Competition
A market characterized by a large number of independent sellers of standardized products, free flow of information, and free entry and exit. Each seller is a "price taker" rather than a "price maker".
Monopolistic Competition
A market structure in which several or many sellers each produce similar, but slightly differentiated products. Each producer can set its price and quantity without affecting the marketplace as a whole.
Oligopolistic Competition
There are only a few firms that make up an industry. This select group of firms has control over the price and, like a monopoly; an oligopoly has high barriers to entry. The products that the oligopolistic firms produce are often nearly identical and, therefore, the companies, which are competing for market share, are interdependent as a result of market forces.
Pure Monopoly
A market in which one company has control over the entire market for a product, usually because of a barrier to entry such as a technology only available to that company.
Distinguish between the 4 types of markets recognized by economists
Pure Competition very large numbers of firms, standardized product, price takers, free entry and exit and many substitutes. Monopolistic Competition many buyers and sellers, differentiated products and sufficient knowledge. Oligopolistic Competition involves a few firms, harder for a firm to enter or exit and Imperfect competition. Pure Monopoly only one firm is involved, products are unique with no substitutes, entry of additional firms is not possible; one firm constitutes the entire industry, entry to the industry is often blocked by Government and It requires patent or licenses.
What kind of market is the internet...