Nature of competition in real world: A critical analysis.

Nature of competition in real world: A critical analysis.Submitted to: Prof. M.P.Rege

Group Members1.2.3.4.5.6.

Agenda

What is Market?

The Four Types of Market Structure

Monopoly

Oligopoly

Monopolistic Competition

Perfect Competition

Tap water Cable TV Tennis balls Crude oil Novels Movies Wheat MilkNumber of Firms?Type of Products?

Many firms

One firm

Few firms

Differentiated products

Identical products

Perfect Competition

Price Determination In Perfect Competition

Equilibrium Point

Time Element in Price Analysis Marshalls Theory of time

Pricing in Market Period

Pricing in Short Run period

Pricing in Long Run period

Pure competition

Imperfect Competition

Monopoly Competition

Features

Advantages of monopoly :

Disadvantages of monopoly

Monopsony Competition

Monopolistic Competition

Features

Oligopoly Competition

Features

Kinked demand curve and price rigidityReaction to price reductionReaction to price increase

ELASTIC DEMAND (other firms do not follow price increase)LESS ELASTIC DEMAND(other firms follow price cut))KPrice change unmatchedPrice change matcheddDdDDDDQUANTITYPRICE

Oligopsony Competition

Kinds of competetionNumbers of product and degree of diferentiationPart of Economy where prevalentDegree of control over price 1 2 3 41. Perfect competitionMany producer identical productsFew Agricultural commoditiesNone2. Imperfect Competitiona) Monopolistic CompetitionMany ProducersMany Real Or Imaginary Difference in ProductRetail Trade,Toothpaste,Soap etcSomeb) OligopolyFew producer Little or no difference in productSteel AlluminiumSome

Kinds of competetionNumbers of product and degree of diferentiationPart of Economy where prevalentDegree of control over price1234b) Oligopoly2. Few Producers, Some Diffrentiation of productAutos, MachinerySomec) MonopolySingle ProducerSingle ProductWithout Close SubstitutesFew Public UtilitiesConsiderabled) MonopsonySingle buyerSingle OuletWith Remote Substitute OutletsIndian wagonIndustryLocal labour marketsDominated by single firmConsiderable

Kinds of competetionNumbers of product and degree of diferentiationPart of Economy where prevalentDegree of control over price1234e) OligopsonyFew Buyers1. Milk DiariesSome1. Liitle or no differnce in buyers2. Local Agricultural Market Dominated by a few processorsSome2. Differnce in Buyers3. Market for Certain Components such as auto parts Some

SD1D1DDD2D2Quantity DemandedXYOQPP1P2

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