Market Structure... Continued (10 Minutes)

Thirdly, monopolistic competition is a situation where there are many competitors and it is closer to perfect competition market.  This is realistic of what we typically call competition in our markets, but for purposes of this course, we will combine it  with perfect competition and simply refer to the environment as competitive market.

Finally, an oligopoly is a situation where there are few competitors and is closer to the monopoly market. It is the most realistic of what we typically call monopoly in our markets, but for purposes of this course, we will combine it  with perfect monopoly and simply refer to the environment as monopoly market.

Shifting from competition to Monopoly (10 minutes)

Work in the same group as before.

• List the advantages and disadvantages of operating in a competitive market.
• List the advantages and disadvantages one would face if they belonged in a monopoly market.
• Determine which market the group would prefer and provide reasons why.
• What actions could you take to move closer to a monopoly situation and gain from economies of scale?