Output Determination Under Monopolistic/Imperfect Competition:
Before 1933, the price analysis was studied under two market
as the name signifies is a blend of monopoly and competition. It
is a systematic and realistic theory of price analysis in this
imperfectly competitive world.
The main characteristic or
features of monopolistic competition are as under:
Monopolistic competition refers to
the market organization where there are a fairly large number of
firms which sell somewhat differentiated products.
In the long run, the firms are able to alter the scale of plant
according to the changed conditions of demand for a product in
monopolistic competition or imperfect competition, there are
wastes of expenditures. Wastes of monopolistic competition
are in brief as follows:
Oligopoly falls between two extreme
perfect competition and
monopoly. Oligopoly occurs when a few firms
dominate the market for a good or service.
If an industry is
composed of only two giant firms, each selling identical
products and having half of the total market, there is every
likelihood of collusion between the two firms.
Economic Models of