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Questions
Explain the implications of the following in a perfectly competitive market:
Large number of buyers
Explain the implication of a large number of buyers in a perfectly competitive market.
Solution
A large number of buyers:- A perfectly competitive market is a market which consists of a large number of buyers and sellers. They produce a homogeneous product. When the number of buyers is more, the demand of an individual buyer is only a small portion of the market demand. Individual buyers cannot influence the market price of a good by varying their demands, and thus, an individual buyer is a price taker and not a price maker.
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RELATED QUESTIONS
The objective of a seller in monopoly market is...............................
(loss \ profit \ negative profit \ zero profit)
There is inverse relation between price and demand for the product of a firm under:
(choose the correct alternative)
(a) Monopoly only
(b) Monopolistic competition only
(c) Both under monopoly and monopolistic competition
(d) Perfect competition only
Demand curve of a firm is perfectly elastic under: (Choose the correct alternative)
(a) Perfect competition
(b) Monopoly
(c) Monopolistic competition
(d) Oligopoly
Explain the implications of the following : Product differentiation in monopolistic competition.
Explain the 'free entry and exit of firms' feature of monopolistic competition.
Answer the following question
What are the features of monopolistic competition?
State with reason whether you agree or disagree with the following statement
A seller is price maker in monopoly.
Answer in detail
What is Perfect Competition? Explain price determination under Perfect Competition.
Write short note on the following:
Features of pure competition
Define or explain the following concept:
Selling cost
Give reason or explain:
A monopolist can control the supply of goods.
Give reason or explain:
Sellers and the buyers are price takers in perfect competition.
State whether the following statement is TRUE and FALSE.
There is no price discrimination under Monopolistic competition.
Fill in the blank with appropriate alternative given below
Under perfect competition commodities are ________________ in nature.
Fill in the blank with appropriate alternative given below
In ________ market, seller creates products differentiation.
Fill in the blank with appropriate alternative given below
Monopolist means __________ competitive.
Define 'or' explain the following concept.
Product Differentiation:
PASSAGE
In India, markets for automobiles, cement, steel, aluminium, etc, are the examples of oligopolistic market. In all these markets, there are few firms for each particular product. Duopoly is a special case of oligopoly, in which there are exactly two sellers. Under duopoly, it is assumed that the product sold by the two firms is homogeneous and there is no substitute for it. Examples where two companies control a large proportion of a market are: (i) Pepsi and Coca-Cola in the soft drink market; (ii) Airbus and Boeing in the commercial large jet aircraft market.
Operating systems for smart phones and computers provide excellent examples of oligopolies in big tech. Apple iOS and Google Android dominate smart phone operating systems. Computer operating systems are overshadowed by Apple and Microsoft Windows.
- Give examples of oligopolistic market in India (1 mark)
- Explain the concept of duopoly with a suitable example from the passage (1 mark)
- Express your personal opinion based on the above information (2 marks)
