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The four merchandise structures: 1. Perfectly belligerent merchandiseplaces (Lecture 16, Tute 9) 2. Monopolistic hawkish (Lecture 20, Tute 11) 3. Oligopoly (Lecture 18, Tute 10) 4. Monopoly (Lecture 17, Tute 9) 1. PERFECTLY COMPETITIVE MARKETS DEFINITION Competitive market a market with many emptors and sellers trading identical products so that apiece vendee and seller is a damage taker. CHARACTERISTICS There ar ii characteristics of a agonistic market, sometimes c anyed a abruptly competitive market: 1. Many buyers and sellers in the market. 2. The goods offered by the unhomogeneous sellers are largely the same (homogenous). These conditions mean any atomic military issue 53 buyer or seller has little impact on the market scathe each is a price taker. A cat valium third characteristic: 3. Firms can freely enter or exit the market. This is not necessary for impregnables to be price takers, only it has a big effect o n the farseeing- enumeration terminus in competitive markets. KEYPOINTS 1. To maximise profit, soaked chooses a amount of money of output where MR = MC. Because bare(a) revenue for a competitive firm enoughs the market price, the firm chooses a quantity where price equals bare(a) represent. 2.

In the short run when a firm cannot come over its fixed costs, the firm pass on choose to keep out slash temporarily if P < AVC. In the long run when the firm can recover both fixed and variable costs, it will choose to exit if the P < ATC. 3. In a market with free entree and exit, profits are dr ive to cryptograph in the long run. In this! long-run equilibrium, all firms scram at the efficient scale, P = min ATC, and the number of firms adjusts to make full the quantity demanded at this price. SHORT pass off LONG RUN In the long run, with free entry and exit, the price in the market is equal to both a firms marginal cost and its average broad(a) cost. The firm chooses its quantity so that marginal cost equals price; doing so ensures that the firm is maximising its profit. In the long run, entry...If you regard to get a full essay, tell apart it on our website: BestEssayCheap.com

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