Market Structures and Antitrust Concepts

Notes

Oligopoly Market structure in which few large businesses dominate a market - few sellers, identical products, little freedom, some price control Monopolistic competition A market structure in which many businesses sell goods that are similar but not identical - many sellers, differentiated, little price control, freedom Commodity a product that is the same no matter producer Example: wheat, coffee, sugar, corn Perfect competition Market where a large number of firms all produce the same product - many sellers, identical, freely enter market Barriers to entry any factor that makes it difficult for a new firm to enter the market * start up costs or technology Natural monopoly a market that runs most efficiently when one business supplies all the output Example: utilities Price discrimination divides customers into groups based upon how much they will pay for a good or service. used to make more profits Non-price competition a way to attract customers but not lower prices Examples: style, customer service, location Monopoly a market structure which is dominated by a single supplier Examples: utilities, electric company, water company, KUB Sherman Antitrust Act 1890 made cartels/monopo...