Market Structure

Market Structure Differentiation Analysis

University of Phoenix

ECON 212

Maggie Cutler

October 1, 2011

Market Structure Differentiation

In this paper we will look at the different types of goods, and the labor market and how it is affected by supply and demand. We have chosen Starbucks as the organization we will study concerning how it relates to these issues.

The economic market consists of goods, resources, and market structures. Four main components including private goods, public goods, common resources, and natural monopoly will be compared and contrasted. “A private good is a good that is both, rival and excludable. While a public good is the opposite and is a good that is non-rivalrous and non-excludable. A common resource is a good that is rival but, not excludable. A natural monopoly is a situation that involves one firm and the economies of scale are so large that the firm is capable of supplying the entire market at a lower average total cost than if two or more firms were to attempt to do so”. (Hubbard &O’Brien, 2010, p. G) Economies around the world are made up of companies that conduct their business within specific market structures and most goods in our economy are allocated through these markets. These economies consist of public goods such as the air we breathe, private goods such as a doctor’s visit, common resources including forests, and natural monopolies such as our utilities.

The different market structures include Monopoly, Oligopoly, Monopolistic Competition and, Perfect Competition. The number of companies falling into each market is dependent on the type of product they sell as well as the amount and type of competition they have. In a Perfect Competition...