10/23/2020Sarah's Quizzes - 9 Flashcards | Quizlet1/3Sarah's Quizzes - 9Ren_NewmanSTUDYPLAYFlashcardsLearnWriteSpellTestMatchTAGS RELATED TO THIS SETProfit Maximization Occurs WhenPerfectly Competitive FirmZero Economic ProfitTerms in this set (12)One requirement for anindustry to be perfectlycompetitive is thatthere are no restrictions on entry into or exitfrom the marketA firm in perfect competitionis a price taker becausemany other firms produce identical products Show
Upload your study docs or become a Course Hero member to access this document Difference Between Perfect Competition vs Monopolistic CompetitionPerfect competition is a market structure in which there are numerous sellers in the market, selling similar goods that are produced/manufactured using a standard method and each firm has all information regarding the market and price, which is known as a perfectly competitive market. Monopolistic competition is a type of imperfect market structure. In a monopolistic competition structure, a number of sellers sell similar products but not identical products. Products or services offered by sellers are substitutes of each other with certain differences. A market can be described as a place where buyers and sellers meet, directly or through a dealer for transactions. Flowchart shows Market StructureWhat is the Perfect Competition?
What is Monopolistic Competition?
Just a few examples of monopolistic competition include:
Monopolistic competition is a practical example of a market scenario, it can be seen around us. Types of products or services provided by each market participant are differentiated. Products or services can be differentiated in many ways such as brand recognition, product quality, value addition to products or services or product placing, etc. Perfect Competition vs Monopolistic Competition (Infographics)Below is the top 10 difference between Perfect Competition and Monopolistic Competition: Key differences between Perfect Competition vs Monopolistic CompetitionBoth Perfect Competitions vs Monopolistic Competition are popular choices in the market; let us discuss some of the major Difference Between Perfect Competition and Monopolistic Competition:
Perfect Competition vs Monopolistic Competition Comparion TableBelow is the topmost Comparison between Perfect Competition vs Monopolistic Competition are as follows –
ConclusionAfter reading the all above points, it is quite clear that perfect competition vs monopolistic competition is different in many aspects, the major difference can be understood by the fact monopolistic competition has features of both monopoly and perfect competition. The principal difference between these two is that in the case of perfect competition the firms are price takers, whereas in monopolistic competition the firms are price makers. Perfect competition is not realistic, it is a hypothetical situation, on the other hand, monopolistic competition is a practical scenario. Recommended ArticlesThis has been a guide to the top difference between Perfect Competition vs Monopolistic Competition. Here we also discuss the perfect Competition vs Monopolistic Competition key differences with infographics, and comparison table. You may also have a look at the following articles to learn more
Which of the following is true for both monopoly and a perfectly competitive firm?The correct answer is C. Marginal revenue is equal to marginal cost. Both, monopoly and perfect competition, maximize profits when firms produce the output level at which marginal revenue equals marginal cost (MR=MC).
Which of the following is true of a perfectly competitive firm and a monopoly in the long run?The Correct Answer is D. In a perfectly competitive market, the firm's profit would be maximum only when MR equals MC and MC cuts MR from below. On the other hand, monopoly will be maximizing profits when MR equals MC.
Which of the following characteristics is true about both monopolistically competitive and perfectly competitive firms?Which of the following characteristics is true for both perfectly competitive and monopolistically competitive firms in the long run? There are zero economic profits.
Which of the following is a difference between monopolies and perfectly competitive firms?The correct answer is B. Monopolies can earn profits in the long run while perfectly competitive firms break even. Firms in a perfectly competitive market will earn normal profits over the long run.
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