Question

Determine two different real-life examples for each of the following market structures, and list the determinants to prove your choices. Your score is based on your explanation.

a.) Perfect Competition

b.) Monopolistic Competition

c.) Oligopoly

d.) Monopoly

Answer 1

Answer:-

a.) Perfect compteation:- Perfect compteation market refers to that market situation in which there are large number of buyers and sellers of homogeneous product. the price of the such product is determined by the industry with the market force of demand and supply. There i only one price which prevails in the market.

Example 1:- Agricultural markets are example of the perfect competition market as well. Suppose purchase from at your local farmers' market: there are numerous farmers, selling the same fruits, vegetables. We can easily find out the prices for the goods, but they are usually all about the same.

Example 2:-Cafe coffee day(CCD) has been considered to be a part of a perfect competition market as it meets the four conditions; many sellers and buyers, no preferences, easy entry and exit and market same information available to all.

b.) Monopolistic Competition:- It is a market structure, which shares the features of both perfect comptetion and monopoly (Monopoly+Comptetion). Monopolistic comptetion market refers to a market situation in which there are large number of firms which sells differentiated products.

Example1:- Puma is an example of monopolistic competition market because they have the aspects that a perfect competition has, except their products are not exactly like their competitor like as Reebok and New balance.

Example 2:-Fast food companies like Pizza hut and Pizza express Who sell the pizza in market are the most common type of example monopolistic competition. These two company mentioned above sell near similar type but they different.

c.) Oligopoly:- The oligopoly is a market form of imperfect competition with a few firms operating on a big scale of a commodity and producing a substantial part of total output of the industry. Each seller has a significant share of the market and hence there is high interdependence among sellers regarding th price an output policy.Entry of new firm in a industry is quite difficult. Oligopoly lies between monopoly and monopolistic comptetion.

Example 1:- Automobile manufacturing sellers example of an oligopoly, with the leading auto manufacturers in the United States being Tesla , Jeep, and Chevrolet.

Example 2:- Coca cola is one of the fortunate firms in oligopoly market, their effort in the market has leaded them to the top of beverage market until now so this example of oligopoly competition market.

d.) Monopoly:- Mono means single and Poly means to control, implying one seller. So monopoly means a market condition in which there is a single producer of a commodity with no close substitutes. The whole market is under control and there is a single producing unit called firms or industry.

Example 1:- Microsoft an Windows is a computer software are the example of the monopoly market which is control 75% share the market.

Example 2:- Public service like Railways are provided by the governmet is  the example of the monopoly market. That's why the price of ticket is resonable so, public transport can be use by the huge numbers of people.

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