CHAPTER 6

MARKET STRUCTURE

Characteristics Perfect Competition Monopolistic Competition Oligopoly Monopoly

1. Number of firms Many firms Many (but not as many as PC Few number of firms but large in One or sole producer
in industry firms) size

2. Examples of firms

3. Type of Product

4. Barriers to
entry

5. Price and
output policy

6. Equilibrium MR = MC MR = MC MR = MC MR = MC
Output

7. Short-run Three types of profit: Three types of profit: Three types of profit: Three types of profit:
Profits - Normal profit - Normal profit - Normal profit - Normal profit
- Supernormal profit - Supernormal profit - Supernormal profit - Supernormal profit
- Subnormal profit - Subnormal profit - Subnormal profit - Subnormal profit
8. Long-run
Profits

11. Degree of
competition