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  • Monopolistic & Oligopoly

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    jyoti pillay
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    This document discusses characteristics of monopolistic competition and price output determination. It describes monopolistic competition as having many sellers offering differentiated products with free entry and exit. Under monopolistic competition in the short run, a firm is in equilibrium when marginal cost equals marginal revenue and marginal cost cuts marginal revenue from below, resulting in supernormal, normal or minimum loss. The document also briefly outlines characteristics of oligopoly such as interdependence between few sellers, barriers to entry, and non-uniform pricing behavior.

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    This document discusses characteristics of monopolistic competition and price output determination. It describes monopolistic competition as having many sellers offering differentiated products with free entry and exit. Under monopolistic competition in the short run, a firm is in equilibrium when marginal cost equals marginal revenue and marginal cost cuts marginal revenue from below, resulting in supernormal, normal or minimum loss. The document also briefly outlines characteristics of oligopoly such as interdependence between few sellers, barriers to entry, and non-uniform pricing behavior.

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    © All Rights Reserved
    Download as PPTX, PDF, TXT or read online from Scribd
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    2 views6 pages

    Monopolistic & Oligopoly

    Uploaded by

    jyoti pillay
    This document discusses characteristics of monopolistic competition and price output determination. It describes monopolistic competition as having many sellers offering differentiated products with free entry and exit. Under monopolistic competition in the short run, a firm is in equilibrium when marginal cost equals marginal revenue and marginal cost cuts marginal revenue from below, resulting in supernormal, normal or minimum loss. The document also briefly outlines characteristics of oligopoly such as interdependence between few sellers, barriers to entry, and non-uniform pricing behavior.

    Copyright:

    © All Rights Reserved
    Download as PPTX, PDF, TXT or read online from Scribd
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    of 6

    Monopolistic

    Competition
    Characteristics of monopolistic
    competition
    1. Large number of sellers
    2. Product differentiation
    3. Non Price Competition
    4. Freedom of entry and exit
    5. Independent Behavior
    Price Output Determination Under
    Monopolistic Competition
    In the short period a firm is in equilibrium when;
    2. MC=MR and
    3. MC curve cuts MR from below.

    The firm may face any of the three situations in this


    time period:
    (1) Supernormal Profits (2) Normal Profits and (3) Minimum Loss
    Price Output Determination Under Monopolistic Competition
    Oligopoly

    1. Few sellers
    2. Interdependence
    3. Advertisement
    4. Competition
    5. Barriers to Entry of Firms
    6. Lack of Uniformity
    7. Demand Curve
    8. No Unique Pattern of Pricing Behaviour
    Price determination under Oligopoly
    The Sweezy Model of Kinked Demand Curve

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