Monopolistic Competition
Name the Four Major Characteristics?
What are
1. Many sellers and many buyers.
2.Similar but differentiated products.
3. Limited control of prices
4. Freedom to enter or exit the market.
Number of sellers, type of product, sellers' control over prices, freedom to enter and exit the market.
What is few, standard for individuals but differentiated for consumers, some, and many.
Name the four major characteristics
What are
1. Only one seller
2. A restricted regulated market
3. Control of prices
4. Significant barriers to enter and exit
Characteristics of Perfect Competition.
What is numerous buyers and sellers, standardized product, freedom to enter and exit a market, well informed buyers and sellers.
Describe price differentiation.
What is... The effort to distinguish a product from similar products.
Standardized or Differentiated Products
What is many markets are standardized with few large firms. When standardized, brand, name, service, or location determines interest. They are differentiated using marketing strategies to customize.
When the costs of production are lowest with only one producer.
What is .... Natural Monopoly?
Numerous Buyers and Sellers.
What is a large number of buyers and sellers is neccessary for perfect competition. Buyers can choose to buy from a different producer. Sellers can sell at market price.
Describe Nonprice Competition.
What is... When producers use factors other than low price to try to convince consumers.
An example of few sellers and many buyers.
What is athletic wear from brands like Nike or Adidas.
When the average cost of production falls as the producer grows larger.
What is geographic monopoly?
What is something consumers see as identical regardless of the producer. Price is the only factor for purchasing.
Many sellers and many buyers.
What is...
Number of sellers is usually smaller than in a perfectly competitive market. It is enough for meaningful competition.
The reason there is little freedom to enter the market.
What is it's too expensive?
Monopolies acting as price makers because they sell products that have no close substitutes and they face no competition.
What is control of prices?
Freedom to Enter and Exit the Market.
Similar But differentiated products.
What is sellers getting monopolistic power from making a distinctive product or convincing consumers their product is different from the others.
An example of standardized but differentiated products.
What is oatmeal? (other examples will be accepted)
As the only seller of a product, monopolies become a
What is price maker?
Independent Buyers and Sellers.
What is buyers and sellers not joining together to influence the price. Independent action ensures the the market is competitive.