market types by ramaswamy uggem
TRANSCRIPT
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MARKET STRUCTURES
Ramaswamy Uggem
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Market StructureMarket structure is best defined as the organisational and other characteristics of a marketIt refers to the number of competing firms in the market
It is defined by 3 characteristics: 1.The number of firms in the market 2.The ease of entry and exits of firms 3.The degree of product differentiation
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4 Market structures
Perfect competition
Monopolistic
competitionOligopoly Monopoly
Least Most
Competitiveness level
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PERFECT COMPETITIONPerfect competition is an economic model of a market situation characterized by a large number of firms all making the same product
Features of perfect competition:Many firms.Freedom of entry and exitAll firms produce an identical or homogeneous product.All firms are price takersEg::Banks, Vegetables Market, Travel Agencys…
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Monopolistic CompetitionMonopolistic competition occurs when there are many firms in the industry, each selling a slightly differentiated product
Features of monopolistic competition:A large number of firmsEasy entryDifferentiated productsEg::Novels,films
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OligopolyA market in which there are a few large firms competing with one another
The main features of oligopoly:An industry which is dominated by a few firms.Interdependence of firms, firms will be affected by how other firms set price and output.Barriers to entry, but less than monopoly.Different (Differentiated oligopoly) / homogeneous (Pure oligopoly) Products advertising is often important
Eg::TCS,Vizag Steel (AP),Oil
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MonopolyMonopoly is defined as a single seller of a product. i.e. 100% of market shares
Characteristics of Monopoly:There is a single sellerThere are no close substitutes for the firms productThe firm is a ‘price maker’No close substitutesEg: Indian Railways,State E-city Boards,
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No.of Firms
Buyers Product s
Ads Entry intoMarket
Examples
PerfectCompetition
Many Many Homogeneous
None Easy VegetableMarkets
Monopolistic Competition
Many Many Differentiated
Some Easy Novels
Oligopoly Few Many Differentiated/homogeneous
Some more
Hard Automobiles,Steel,oil
Monopoly One Many no close substitutes
None Very Hard
Indian Railways
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Thank youhave a nice Day Syndians….