Question

2. Define Market Structure in Economics ? Define Perfect Competition. Define Imperfect Competition.

3.) Describe the Perfect Competition Firm's Demand Curve and explain why it's that shape.

3. For an Industry in Perfect competition, when is it possible to Enter and Exit the market?[ The Market Supply Curve is determined by What 5 Determinates?

5.) What is a Monopoly (define and explain)? The Market Supply Curve is determined by What 5 Determinates? Explain each determinate.

Answer 1

The market structure is the organizational and firms characteristics. The important characteristics are competition and pricing. The market structure is determined in the market the competition existed in that particular market.

The perfect competition is a market structure; there is a large number of buyers and sellers selling a homogenous commodity. Under perfect competition, firms cannot influence the market price.

The imperfect competition is a market structure when the producer has some control over the price.

Answer—3

The demand curve in perfect competition is a horizontal line. It is equal to the market price. That means the price cannot change whatever the quantity sold. Because of under perfect competition there is no control over the price.

under perfectly competitive market, there are no barriers to entry and exit. The firm would an entry in the industry when all firms are earning a potential profit. The higher entry will reduce the profit earned by the firm, and some firm would exit in the long run. And some will get break even.

The market supply is determined by the factors like the number of sellers, the level of technology, the prices of inputs, the expectation of price and the government regulation.

Answer—4

The monopoly is a market structure when only one firm sells all the product and no close substitutes. Here there are strict barriers to entry existed. In the monopoly market, the individual firm has full control over the supply, that means the elasticity of demand is zero. Also, the demand curve is downward sloping, and the firm can earn revenue by increasing her sales.