Answer to Question #209056 in Microeconomics for Essy

Question

difference perfect competition and monopoly market structures in terms nature of product, entry ,firms control over price, collusion

Answer 1

 A perfect competition market structure is characterized by goods and services with close substitutes, while a monopoly market deals with goods and services with no close substitutes. There are high barriers to entry in the market monopoly market structure, while in perfect competition, there is free entry and exit in the market. In a monopoly market, the seller is a price maker. In contrast, in perfect competition, the sellers have no control over the prices since it is set by the demand of the goods and services.no collusion in a monopoly since there is only one seller. In contrast, in perfect competition, collusion exists due to the competition that exists.