Competitive Market Structure
In addition to elasticity of demand, the competitive environment drives supply, demand and prices. The greater the competition in a given market, the more sensitive the market price is to changes in suply and demand. Four basice market structure:
Pure Monopoly, If there is only one seller with a unique roduct, then the seller is said to have a pure monopoly,
Oligopoly. When ther are only a few suppliers for a product for which there are few substitutes, then what prevails is sna oligopoly. with only a few competitors, prices can be maintained at high levels if the producers choose not to compete on rice. If not, the market plyers can engage in price wars that can push prices down.
Monopolistic Competition. In a market where there are many producers with products that can be differentiates, monopolistic competition can occur.
Pure Competition. In pure competition there are many competitiors selling a similar, substituable product. Marketing does not affect the price producers can get.
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