Market-nomics

Types of Market.

1. Competition Market

Perfect market is described as market structure, where a large number of small businesses compete with each other for available market share. In this scenario a single firm does not have any significant market power.

2. Monopolistic Market.

Monopolistic competition also refers to a market structure, where a large number of small firms compete against each other. However, unlike in perfect competition, the firms in monopolistic competition sell similar, but slightly differentiated products. This gives them a certain degree of market power which allows them to charge higher prices within a certain range.

3. Oligopoly

An oligopoly describes a market structure which is dominated by only a small number firms. This results in a state of limited competition. The firms can either compete against each other or collaborate. By doing so they can use their collective market power to drive up prices and earn more profit.

4. Monopoly

A monopoly refers to a market structure where a single firm controls the entire market. In this scenario, the firm has the highest level of market power, as consumers do not have any alternatives. As a result, monopolists often reduce output to increase prices and earn more profit.