Imperfect Competition in Economics

Imperfect competition = Market inefficiencies and potential market failure Perfectly competitive market = Characterized by perfectly elastic demand curve Market power = Ability to affect the price of a good above marginal cost Monopoly = Greatest ability to raise price above marginal cost

Market structure = Determines the nature of market competition Market concentration = Degree of suppliers' market dominance Demand curve = Illustrates the relationship between price and quantity demanded Price above marginal cost = Indicator of market inefficiency

Competitive structure impacts financial performance = Causal relationship between competitive structure, behavior, and performance paradigm Level of competition below perfectly competitive market conditions = Imperfect competition Range of market competition from perfect competition to pure monopoly = Perfect competition to pure monopoly Downward sloping demand curve = Imperfect market

<p>Raise price above marginal cost = Increases market inefficiency Measure degree of suppliers' market dominance = Determines market structure Impact of monopolies on price control = Greatest ability to raise price above marginal cost Effect of competitive structure on firms' conduct and performance = Significantly impacts financial performance</p> Signup and view all the answers

<p>Imperfect competition = Market situation not fulfilling all necessary conditions of a perfectly competitive market Market inefficiencies = Result of imperfect competition causing potential market failure Market power = Ability to affect the price of a good and raise it above marginal cost Demand curve = Illustrates the quantity of a good or service consumers are willing to buy at various prices</p> Signup and view all the answers