UNIT 2-MARKET

MORPHOLOGY
MARKET
A market is a mechanism by which buyers and sellers of a commodity are able to
contact each other for having economic exchange and are able to strike a deal about
the price and the quantity to be bought and sold.

Types of Market Structures by Vidhi Kalra - YouTube- Do watch this out

FEATURES OF A MARKET
Market need not be a particular place
Buyers and sellers need not have personal contact
They need to have a system of communication with each other
MARKET STRUCTURE
It refers to the types of market in which the producers or firms operate.
TYPES OF MARKET
Perfect Competition
Monopolistic Competition
Monopoly
Duopoly
Monopsony
Oligopoly
FEATURES OF A
MONOPOLISTIC MARKET
Large no. of buyers and sellers
Differentiated Products
Free entry and exit
Selling Costs are prevalent
Demand Curve is negatively inclined
Non-Price Competition prevails
FEATURES OF PERFECT
COMPETITION MARKET
Large no. of buyers and sellers
Homogeneity of the product
Free entry and exit of firms
Demand Curve is perfectly elastic
Perfect knowledge prevails
Perfect mobility of factors of production
No Transport costs
FEATURES OF A MONOPOLY
Single Seller
No close substitutes
Demand Curve is negatively inclined but less elastic owing to non-availability of
substitutes
Closed entry
Firms are Price-Makers
Possibility of Price Discrimination
FEATURES OF OLIGOPOLY
Intensive Competition
Interdependence amongst firms
There might be oligopoly with product differentiation or oligopoly without product
differentiation
Selling Cost is an important feature
Barriers to entry exist
Demand Curve is indeterminate/kinked due to interdependence of firms