- Join over 1.2 million students every month
- Accelerate your learning by 29%
- Unlimited access from just £6.99 per month
Differences between monopoly and monopolistic market competition.
Are you in the right place?
Jump to Economics and see how teachers think you should prepare in:
The first 200 words of this essay...
DIFFERENCES BETWEEN MONOPOLISTIC COMPETITON AND MONOPOLY MARKET STRUCTURE
Monopolistic competition and monopoly are two market structures existing on rather two extremities of the market structure analysis. In this essay I will give their definitions, discussing their characteristics, giving their differences and concluding with an overview of what I have been able to achieve.
Amos WEB (2000-2010) defines Monopolistic competition as a market structure in which a large number of firms manufacture and produce not necessarily the same product but similar products but still maintain a substantial amount of profit. For example, the manufacturing of pens, firms manufacturing these can be said to exist in a monopolistic competition market where four or more firms manufacture the same product or similar products in this case pens. There is freedom of entry and exit and extensive knowledge of prices and technology.
The diagram above represents monopoly competition.
It has four characteristics, which are:
1. Large number of small firms: This market contains large numbers of comparatively small firms when compared to the size of the market. This gives for high rate of competition and little control over price or quantity.
Found what you're looking for?
- Start learning 29% faster today
- Over 150,000 essays available
- Just £6.99 a month
Not the one? We have 100's more
Markets & Managing the Economy (view all)
- Explain and illustrate the roles played by profit in allocat...
- Explain how the equilibrium level of output is determined in...
- To what extent is Price elasticity of demand useful in a com...
- income distribution
- customer service
- Other than depreciation in exchange rate discuss which solut...
- Analyse the characteristics of a contestable market
- Economics: Examine the main influences on the price of cars
- Discuss the extent to which a tax on chewing gum is the most...
- Using the data and your economic knowledge, evaluate the eco...
""Asmaa, UAE. GCSE Student. Biology, Physics, Chemistry, Maths and English.
""Sabreena, England. A Level Student. Biology and Chemistry.