Perfect competitive

Industry structure

1 how many firms are in an industry

2 whether the firm are big or small

3 wha the firms cost structures look like

4 how market share it divided among the firm

 

Perfect competition-invisible hand/ Adam Smith

Imperfect competition

1 monopoly

2 monopolistic competition

3 oligopoly

 

Key Feature of industry structure, market conduct, maket performance, measured by yardsticks e.g. allocative and productive efficiency

 

A homogeneous products= a product such that each firm's output  is in distinguishable from any other firm's output. E.g. wheat and coal.

The only thing that firm can compete on is price.

Ealy to entry and exit

Consumer will always pay the lowest price available because they will always know what the price is.

Social benefits= Sociaal cost

 

The pricing and production rules under perfect competition.

P=MR=MC

 

The shutdown point comes where revenues just cover variable costs or where losses are equal to fixed costs.

When the pricse falls below the level where revenues are equal to variable costs, the firm will minimize its losses by shutting down.

Long run equikibrium: P=ATC

Pareto Optimality, when no possible reorganization of production can make anyone better off without making someone else worse off.

 

embody 包含

tactics 戰術手段

yardstick 衡量標準 Do you think the TOEIC score is a good yardstick of English porficency?

In contracts