Comparing Market Structures (Exercise 9-2)

	Perfect Competition	Monopolistic Competition	Oligopoly	Monopoly
Number of firms	Very Many	Many / Several	Few	One
Freedom of Entry	Unrestricted	Unrestricted	Restricted	Restricted or completely blocked
Nature of Product	Undifferentiated	Differentiated	Undifferentiated or differentiated	Unique
Implications for demand curve	Horizontal: firm is a price taker	Downward sloping but relatively elastic	Downward sloping. Relatively inelastic	Downward sloping: more inelastic than Oligopoly.
Average size of firms	Small	Small to Medium	Medium to Large	Very Large Firms
Possible consumer demand	Perfect elastic	Relatively elastic	Kinked Demand curve	Inelastic demand
Profit making possibility	Normal profit in the long run	Normal Profit	Economicprofit	Economicprofit
Government intervention	None	None	Unregulated	Taxes and proce setting
A new example	Wheat and corn (commodities)	Toothpaste, Software	Automobiles, Airlines	Utilities (Gas, Water, Electricity)
Ability to Control Prices	None	Little	Little	High