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Question
Distinguish between perfect competition and monopolistic competition on the basis of the following:
(a) Number of sellers
(b) Nature of product
(c) Selling cost
Solution
The difference between perfect competition and monopolistic competition is given as follows:
| Basis | Perfect Competition | Monopolistic Competition |
| Number of Sellers | Under Perfect Competition market, there exist a large number of sellers for a particular commodity. | Under the Monopolistic Competition market, there exists a large number of sellers for a commodity. |
| Nature of Product | Firms under Perfect Competition, sell homogeneous products that are perfect substitutes of each other. | Firms under this market structure produce similar yet differentiated products that are 'close' substitutes of each other. |
| Selling Cost | No selling cost is required. | The selling cost is very significant. |
RELATED QUESTIONS
What are the features of perfect competition.
The seller is a price maker in the perfect competition.
Explain the features of monopoly.
Homogenous product’ is a characteristic of : (choose the correct alternative)
(a) Perfect competition only
(b) Perfect oligopoly only
(c) Both (a) and (b)
(d) None of the above
Explain the implications of the following in a perfectly competitive market :
Large number of sellers
Explain the implications of the following in a perfectly competitive market :
Homogeneous products.
Explain the implications of the following in an oligopoly market: Barriers to entry of new firms
Explain the implications of the following in an oligopoly market: A few or a few big sellers
‘A few big sellers’ is a characteristics of : (choose the correct alternative)
a. Perfect competition
b. Monopolistic competition
c. Oligopoly
d. None of the above
Explain the implications of the following : Product differentiation in monopolistic competition.
Price discrimination is possible under monopoly.
Define monopoly.
Answer the following question :
What are the features of monopolistic competition ?
State with reasons, whether you Agree or Disagree with the following statements.
Perfect competition is an imaginary concept.
Answer in detail
What is Perfect Competition? Explain price determination under Perfect Competition.
Write short note on the following:
Features of pure competition
Give reason or explain:
Price discrimination is possible under monopoly.
Match the following:
|
Group A
|
Group B
|
|
Monopoly
|
Public monopoly
|
|
Product differentiation
|
Abnormal profit
|
|
Railway
|
Monopolistic Competition
|
|
Perfect Competition
|
Prof. Chamberlin
|
|
Pure Competition
|
Homogenous product
|
|
|
Cartel
|
|
|
Selling cost
|
Define 'or' explain the following concept.
Product Differentiation:
Answer the following question.
Elaborate three main features of a monopoly form of market.
