Market Structure:

Perfect Competition:

Study Paradigm of Market (Industrial Organization):

Market Structure (S) / Behaviours or Conduct (C) / Performance (P)

Perfect Competition:

Conditions or Assumptions:

a) Many buyers and sellers: fragmented industry so that each company has negligible market share that cannot change the whole structure

b) Homogeneous (or identical) product: Consumers will not acquire additional costs in collecting additional information. Ex) Gold, silver etc.

c) Perfect mobility of inputs: no entry or exit barriers

d) Perfect information

e) No transaction cost

f) Price takers- price is now a parameter
* P.C. is an ideal type of market structure with good predictability of market.

Profit maximization of a representative firm:

• Supply curve- MC curve above AVC.
• Point D- Shut-Down Point
• Point E- Beak-Even Point
• Demand curve: MR curve at P*
• Total revenue: ? P*OQ*C
• Total costs: ? AOQ*B
• Economic profit: ? P*ABC
• Any points between D and E: A firm should produce some output even though the firm is facing economic losses. Why?

Industry Supply Curve in SR:

Residual Demand Elasticities:

(amount demanded from i-th firm) = (industry demand) – (amount produced by all other firms)

The smaller i k is, the larger εi , which depends on supply elasticities of other firms.

In competitive market,

i) ki is relatively small.
ii) even if ki is not small but if eS is elastic, then εi is elastic.

Latest technology based Microeconomics Online Tutoring Assistance

Tutors, at the www.tutorsglobe.com, take pledge to provide full satisfaction and assurance in Microeconomics help via online tutoring. Students are getting 100% satisfaction by online tutors across the globe. Here you can get homework help for Microeconomics, project ideas and tutorials. We provide email based Microeconomics help. You can join us to ask queries 24x7 with live, experienced and qualified online tutors specialized in Microeconomics. Through Online Tutoring, you would be able to complete your homework or assignments at your home. Tutors at the TutorsGlobe are committed to provide the best quality online tutoring assistance for Microeconomics Homework help and assignment help services. They use their experience, as they have solved thousands of the Microeconomics assignments, which may help you to solve your complex issues of Microeconomics. TutorsGlobe assure for the best quality compliance to your homework. Compromise with quality is not in our dictionary. If we feel that we are not able to provide the homework help as per the deadline or given instruction by the student, we refund the money of the student without any delay.