| Term | Definition |
|---|
| market structure | setting in which a seller finds itself; defined by characteristics, such as number of sellers in the market, product produced and sold, and level of difficulty for new firms to enter the market |
| perfectly competitive market | characterized by 1) many buyers and many sellers, 2) all firms selling identical goods, 3) all relevant information about buying and selling activities available to buyers and seller, and 4)easy entry into and easy exit out of the market |
| price taker | seller that can sell all its output at the equilibrium price but can sell none of its output at any other price |
| monopolistic market | market structure characterized by 1) single seller, 2) sale of a product that has no close substitutes, and 3) extremely high barriers to entry |
| barrier to entry | anything that prohibits a firm from entering a market |
| price searcher | seller that can sell some of its output at various prices |
| public franchise | right granted to a firm by government that permits the firm to provide a particular good or service and excludes all other from doing so |
| natural monopoly | firm with such a low average total cost (per-unit cost) that only it can survive in the market |
| antitrust law | legislation passed for the stated purpose of controlling monopoly power and preserving and promoting competition |
| monopolistic competitive market | characterized by 1) many buyers and many sellers, 2) production and sale of slightly differentiated products, and 3) easy entry into and exit from the market |
| oligopolistic market | characterized by 1) few sellers, 2) production and sale of either identical or slightly differentiated products, and 3) significant barriers to entry |
| cartel agreement | agreement that specifies how the firms that entered into the agreement will act in a coordinated way to reduce the competition among them |
| price discrimination | practice by which a seller charges different prices (to different buyers) for the product it sells when the price differences do not reflect cost differences |
Combine with other sets
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