Differentiating Between Market Structures

Markets are different, without these different markets there would not be any structure. Being able to understand different markets and its language, like demand, supply, average variable cost and marginal costs we can better prepare for economic and financial future. The market structure and the interaction that occurs can be defined by the number of businesses, and barriers new firms have when entering a particular market. Perfect competition, monopoly, monopolistic and oligopoly are four forms of market structures recognized by economists.

Compare and Contrast

Public goods are by their nature non-exclusive (people cannot be prevented from enjoying the good or it is prohibitively costly to do so) and non-rival (when one person consumes the good it does not reduce the satisfaction that another can receive from the good). A classic example is "national defense". The fact that someone may be enjoying a unit of national defense does not keep someone else from enjoying the same unit and does not diminish the satisfaction you receive from enjoying it.

Private goods are excludable, such as food, clothing, toys, furniture, and cars, which are types of goods that can be rival and non-rival. For example, rival goods are types of goods that consumer prevents the usage of the goods at the same time, durable goods and the usage can be shared with others, such as lather however, in contrast the rival goods can be unendurable such as food, once eaten, cannot be reused. In contrast, non-rival goods can be consumed by the consumer and will not prevent simultaneous consumption by others. These kinds of products are broadcast TV as when in use in one place doesn’t prevent it from usage in other places.

Natural monopoly represents the single ...

... middle of paper ...

...ntinuously differentiate their products so that they manage to earn economic profit. The market structure and the interaction that occurs can be defined by the number of businesses, and barriers new firms have when entering a particular market.

Works Cited

Brue, Stanley L., and McConnell, Campbell R. Economics–Principles, Problems and Policies (15th edition). Boston: Irvin/McGraw-Hill, 2008.

Department of Economics (n.d). Labor Market Equilibrium. , Retrieved January 19, 2010, from http://faculty.washington.edu/ezivot/econ301/labor_market_equilibrium.htm

Peasrson Edication, Inc. (1995-2010). Retrieved on February 21, 2010 from

Http://wps.prenhall.com/bp_casefair_econf_7e/30/7931/2030537.cw/index.html

Sparksnotes Editors (nd). Sparknote on labor Demand. Retrieved January 19, 2010, from http://www.sparknote.com/economics/micro/labormarkets/labordemand/