Each bin below is labeled with one of the four basic market models. Identify the

Question

Each bin below is labeled with one of the four basic market models. Identify the market characteristics that are associated with each particular market model, by placing the eight market characteristics in the appropriate bin. Pure Competition Monopolistic Competition Oligopoly Pure Monopoly Individual firms are price takers, and firms can easily enter or exit the industry. There is an emphasis on nonprice competition, such as advertising brand names, and trademarks, and entry into the industry is relatively easy. A very large number of firms that produce a standardized product. There are a few firms and each is affected by the actions of its rivals, and there are significant obstacles blocking the entry of new firms into the industry. A single firm that produces a product with no close substitutes. Many firms that produce a differentiated product. A single firm which has considerable control over the price it charges for the product it produces, and the entry of new firms into the industry is blocked Hint Previous Check Answer 0 Next I Exit

Explanation / Answer

Oligopoly : There aee few firms and each is affected vy the actions of the rivals, and there are significant obstacles blocking the entry of new firms

There is an emphasis on non price competition as the firm sells the same product in the same market, to attract more customers one firm can reduce the price of the products

Monopolistic competition : Many firm producers a differentiate product.

Perfect /pure competition :1. Individuals are price takers and can easily enter and exit the market.

2. A very large number if firm with standard products. ( homogeneous products)

3. Price takers as they are other firms easily enters and exits the market but wih indistinguishable products makes it difficult for a firm to set its own price.

Monopoly : Single firm produces a product with no close substitutes. A single firm who has a control over the prices of the products and the entry of new firms is restricted.

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