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In monopolistic competition, a company takes the prices charged by its rivals as given and ignores the impact of its own prices on the prices of other companies. If this happens in the presence of a coercive government, monopolistic competition will fall into government-granted monopoly.
Dec 17, 2023 · Updated December 17, 2023. Reviewed by. Michael J Boyle. Fact checked by. Timothy Li. What Is Monopolistic Competition? Monopolistic competition exists when many companies offer competing...
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Feb 27, 2019 · 27 February 2019 by Tejvan Pettinger. Definition: Monopolistic competition is a market structure which combines elements of monopoly and competitive markets. Essentially a monopolistic competitive market is one with freedom of entry and exit, but firms can differentiate their products.
An oligopoly refers to a market with only a few sellers. Monopolistic competition refers to situations where there are many sellers, but the products are highly differentiated. There are several important nuances to explore between these types of markets. Created by Sal Khan. Questions.
- 9 min
- Sal Khan
- Aren't name brand products (i.e. clothing, cars, etc) considered imperfectly competitive markets and...I think my examples might clarify you predicament. Pure/Perfect competition- Agriculture (many farmers, all growing the same thing)= Price Takers M...
- poly- means many and mono- means one so doesn't the word monopoly mean "one many"?The Greeks also used poly as a suffix to mean sell, or one who sells. So, as Sal said, it would mean mono "One" poly "Seller." When used as a prefi...
- The difference between Monopoly and monopolistic competitionMost simply, in a monopoly market their is only a single seller. In monopolistic competition, there are a few sellers selling slightly differentiat...
- What about products that have high differentiation and few competitors (i.e. Those on the top left p...I would say very rarely, but possible if you consider luxury items like million dollar sports cars and such. It's not that there are regulations to...
- When Sal drew the graph, he put low differentiation for monopolies. But what if there are two compet...If there are two competitors, then differentiation can be very low. Think of things like Coke and Pepsi, which are so similar that most people can'...
- what would the solar industry be?Industries dealing with solar equipment, i think, would be categorized under perfect competition because even though there are many brands, there a...
- So, if I understand this correctly, the airline industry would be an oligopoly, right?I think my examples might clarify you predicament. Pure/Perfect competition- Agriculture (many farmers, all growing the same thing)= Price Takers M...
- my textbook talks about something called monopsony. where does that fall?Monopoly is when there is only one seller of a good or service. Monopsony is when there is only one buyer. I am trying to think of an example for y...
- I would like to learn about Long run and short run.I think there is a lot of information on the Internet, but not here in particular. I can tell you, as far as I know, that the difference between lo...
In this video we explore why it is hard for a monopolistic competitor to make economic profit in the long run. Created by Sal Khan.
- 9 min
- Sal Khan
- at 5:40, when demand curve shifts to the left, why does the slope change ? It should just move to th...The new demand curve doesn't have to be parallel to the old one, since it is likely that people with more money still want to buy iPad. So the the...
- As, the demand curve is also more inelastic, what other consequences might happen?The demand curve for the monopolistically competitive seller is more elastic (closer to horizontal) than that faced by a monopoly seller but more i...
- Why does the profit rectangle not extend down to where the MC = MR?The blue demand curve plots (average total) sales price. The yellow ATC curve plots (average total) cost price. The economic profit is the average...
- Is there any economic significance to the point at which the ATC and MC curves intersect?Where MC interacts the ATC curve at the lowest point is where productive efficiency occurs.
- When shifting demand (or supply) curves, how do we determine if these curves pivot as opposed to shi...Over time the firm's demand curve would tend to become more elastic (horizontal) as more and better substitute products enter the market to compete...
- Could you write down more examples of monopolistic competition?The monopolistic competition characterizes some particular qualities - the goods every firm, coming out at market, is the substitutes of other firm...
- Are marginal revenue curves always "twice" the demand curve?You mean twice as steep. Ignoring advanced concepts like kinked demand curves, marginal revenue will be twice as steep as demand if (a) the demand...
- what happens to profits in the long run and what occurs when economic profits exist in monopolistic ...If economic profits exist in a monopolistically competitive market, other firms will notice, and because of the low barriers to entry, these other...
- Would you consider the social media market as a monopolistic competition?The social media market should be considered as an oligopoly because of the relatively high barriers to entry and the small number of large produce...
Monopolies vs. perfect competition (video) | Khan Academy. Google Classroom. About. Transcript. Learn about the key differences between the two extremes of competition: monopolies and perfect competition. Questions. Tips & Thanks. Want to join the conversation? Sort by: Top Voted. Ron Jensen. 5 years ago.
- 5 min
Watch this video for a brief overview of monopolistic competition and to see a comparison between perfect competition, monopolistic competition, and monopolies. The video goes on to explain the cost curves for a monopolistically competitive firm and how it compares to those in different competitive settings, which we’ll cover in more detail ...
