Perfect Competition And Monopolistic Competition Essay

Perfect Competition And Monopolistic Competition Essay

Length: 1633 words (4.7 double-spaced pages)

Rating: Better Essays

Open Document

Essay Preview

Can you imagine the world with a limited amount of choices when it comes to purchasing different products and services? How does perfect competition and monopolistic competition differ and effect our buying power? As stated by Investopedia (2016), “Perfect competition is the opposite of a monopoly, in which only a single firm supplies a particular good or service, and that firm can charge whatever price it wants because consumers have no alternatives and it is difficult for would-be competitors to enter the marketplace (para 1)”.

Perfect Competition
Perfect competition, also known as, pure competition is defined as the situation prevailing in a market were buyers and sellers are so numerous and well informed that all elements of monopoly are absent. In a perfect competition the market price of a commodity is beyond the control of individual buyers and sellers within the market.
When describing perfect competition, it is met within five criteria market bullet points. All firms may sell an identical product, for instance a plethora of cell phone companies all selling the iPhone. All firms are price-takers, they cannot control the market price of their product, which backs up the iPhone even more because you can’t go to one place and find the iPhone cheaper than another place. Prices will be around the same no matter where you go, sellers have no control. All firms have a relatively small market share, Buyers have complete information about the product being sold and the prices charges by each firm. And lastly the industry is characterized by freedom of entry and exit.
1.2 Pricing Strategies
Perfect competition is said to be the complete opposite of a monopoly, only because when a single firm provides a good or service then it i...


... middle of paper ...


...pple with their Android. During the second quarter of 2015 Samsung took a 21.7 percent of the global smartphone market, with shipments 73.2 million units. A reason I feel Samsung is doing much greater then apple right now is their ability to have all these different features, which not only add modern things to their phone but also longevity. With the three new water proof phones that Samsung has come out with Apple has yet to release their first one.
Apple and Samsung have been long duking it out for the title of the king of the smartphone market. Over the past few years Samsung has won the title each quarter. Apple did win the last quarter in year 2014 for their major sales on the iPhone 6 and the iPhone 6 plus, but Samsung quickly regained their spot back after the company’s older galaxy phones sold at a vast rate, as a result of discounts and sales promotions.

Need Writing Help?

Get feedback on grammar, clarity, concision and logic instantly.

Check your paper »

Essay on Benefits Of Having Monopolistic Competition

- In the marketplace, consumers will have more purchasing power in a monosomy market than a monopoly where the sole producer has the power. Monopolies form in several situations, typically through entry barriers or government regulation. The government can relegate a new monopoly in a market that is owned by the government. If one where to think of an example of a government-owned monopoly in Ontario, the first thing that may come to mind for university students would be the LCBO. For those students who have every traveled to any other province, they would find many sellers in the liquor market....   [tags: Monopoly, Competition, Perfect competition]

Better Essays
728 words (2.1 pages)

Market Structure Of Monopolistic Competition Essay

- 1) There are three market types know as Perfect Competition, Monopolistic Competition, and a Monopoly. In the market structure of Perfect Competition there is a large number of producers that produce standardize objects, but they have no power, low barriers to entry, and have a lot of competition. Moreover, the market structure of Monopolistic Competition also has a large number of producers and low barriers to entry, like “Perfect Competition”; nonetheless the product is differentiated, so therefore they have some power, and competition....   [tags: Supply and demand, Price elasticity of demand]

Better Essays
886 words (2.5 pages)

A Perfectly Competitive Market, The Goods Are Perfect Substitutes Essay

- In a perfectly competitive market, the goods are perfect substitutes. There are a large number of buyers and sellers, and each seller has a relatively small market share. Perfect competition has no barriers to information regarding prices and goods, meaning there is no risk-taking behaviour – sellers and buyers are rational. There is also a lack of barriers for entry and exit. Perfect competition is likely to exist in the supply of sugar cane stalks to mills. There are a large number of farmers (the seller) and buyers....   [tags: Monopoly, Competition, Perfect competition]

Better Essays
743 words (2.1 pages)

Pure Competition, Oligopoly, Monopoly, And Monopoly Essay

- “Once again, stock markets have been threatened with extinction for almost 75 years, and I have found that stock markets are harder to kill than roaches”. Arthur Levitt. The irony of that sentence, my friend and I just purchased a combat spray to get rid of roaches at his house (lol). As a child growing my mentor used to always mention this proverb to me “where there 's a will, there 's a way”. Meaning, if you truly want to do something, you will find a way to do it, in spite of obstacles. "Righty tighty lefty loosy!" with that being said, anything that has a strength also have a weakness that comes along with it....   [tags: Monopoly, Perfect competition, Oligopoly]

Better Essays
945 words (2.7 pages)

Monopolistic Competition Essay

- According to the CollinsDictionary.com, “monopolistic means exclusive control of the market supply of a product or service”. (Collins, 2013) A monopolistic has total control of profitable action through the ownership or legitimate funding. Monopolistic competition is about non-price competition (marketing, trademarks, designer titles) whereas the company’s product is different from its competitor’s product or substitute but functions in a similar fashion in whatever industry it may be facilitated for its consumers and lead toward rise in monopoly power but not proceeds....   [tags: market, pricing strategy, insurance]

Better Essays
883 words (2.5 pages)

Essay about Monopolistic Competition

- Are you an extensive traveller. Do you love music. Then your answer is a MP3 Player, a device that allows you to listen to your favorite music on the go. There is nothing like putting on the head set, laying back and listening to some refreshing music when you are exhausted. This is when a MP3 player comes in handy. MP3 players have dominated the market in a huge way and companies would be ready to pay a handsome amount for some off the basket innovation that would lead their company all the way the top....   [tags: MP3 Player, Persuasive Essay ]

Better Essays
981 words (2.8 pages)

Difference Between Oligopoly and Monopolistic Competition Essay

- Difference Between Oligopoly and Monopolistic Competition An oligopoly market structure is one in which there are a few large producers who are present in the industry and account for most of the output in the industry, there are many small firms but these few large firms dominate and have concentrated market shares. Whereas monopolistic competition is a market structure that has a large number of sellers, each of which is relatively small and posse a very small market share....   [tags: Papers]

Free Essays
378 words (1.1 pages)

Competition Leads To A More Efficient Use Of Resources Essay

- Competition Leads to a More Efficient Use of Resources The word “efficiency”, in economists’ dictionary, is often interpreted into the degree of an economy allocates scarce resources to meet the needs and wants of consumers. As we can see that a free market economy is the one in which resources are allocated based on the principle of self-interests. Where there are profits, there are firms, and where there are firms to produce identical goods and services, inevitably, there is competition. The degree of competition determines the market structure which is the main determinant of the behaviour or conduct of firms....   [tags: Economics Perfect Competition ]

Free Essays
1678 words (4.8 pages)

Perfect Competition V. Monopolies Essay

- In the American Economy, business is controlled by the government and the consumer. When a person is the owner of a business that is alone in its product that it provides for the consumer, it is said to be a monopoly. As a monopoly you have sole control over price. Monopolies are regulated by the government in order to prevent the misuse of power that a monopoly has. If a person can only get turkey, for example from one store. Then the store can charge a lot more for that turkey than it could if the store next door was selling it too because then there would be competition....   [tags: essays research papers]

Free Essays
377 words (1.1 pages)

Essay about Perfect Competition

- Brisbane, Australia, is the third largest city; where it serves up some of Australia’s best culinary finds. There is a marvellous collection of Brisbane restaurants with everything from stylish boutique eateries featuring top chefs from around the world to local diners than feature Australian specialities (ABC Integra, 2004). This essay will discuss the extent to which restaurants in Brisbane match the characteristic of a perfectly competitive industry both in the short and long run. Following that, this essay will elaborates on the pros and cons from an economic perspective, the characteristics of a perfectly competitive industry....   [tags: Brisbane Australia Restaurants ]

Free Essays
1400 words (4 pages)