Active Vocabulary
Date: 2015-10-07; view: 410.
| Key terms: market structure; perfect competition; monopolistic competition; monopoly; oligopoly; price taker; price maker; market power; economies of scale. Other words and expressions: actors in the market; entry conditions; information characteristics; product characteristics; homogeneous products; market price; to set a price; output; supply and demand; basic model; interaction of buyers and sellers; fierce competition; to maximize profit. Linking words and phrases: though; as well as; whenever; at the same time; unlike; so; clearly; yet; since; because of; including; basically; eventually, informative. |
One of the crucial elements to understanding how a market will function (though it will not explain everything) is its market structure. These are the key elements that determine the behaviour of firms in the market and the outcome that will be produced by the market. One way of considering the market structure is to talk about the conditions that exist in the market. These conditions fall into (approximately) four categories:
- Actors in the market (both numbers of actors and the sizes of these actors).
- The entry conditions (which includes the exit conditions).
- Information characteristics of the market.
- Product characteristics.
Taken together, these factors provide a useful picture of a market, revealing how it works and the results that one would observe in this market.
Four market structures are:
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| Ex.1. Read the words in the following groups. Pay attention to the word stress. | | |