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| The organization of a market, based mainly on the degree of competition. There are four basic market structures. |
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A market structure in which many producers supply an identical product. This is the most efficient structure, with prices set by supply and demand. |
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A market structure in which a single producer supplies a unique product that has no close substitutes. In an unregulated monopoly, the producer sets prices. |
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| A market structure in which a few firms dominate the market and produce similar or identical goods. This structure is more competitive than monopoly. |
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| A market structure in which many producers supply similar but varied products. This structure is closest to perfect competition. |
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| A situation in which the market fails to allocate resources efficiently. |
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A cost or benefit that arises from production or consumption of a good or service that falls on someone other than the producer or consumer. |
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| Goods and services that are used collectively and that no one can be excluded from using. Public goods are not provided by markets. Examples include national defense and clean air. |
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| The ability to influence prices, usually by increasing or decreasing the supply of goods. |
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| A product that is excactly the same no matter who produces it. |
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| Producers that must accept, or take, themarket price for their product. |
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| Economists refer to the costs of shopping around for the best product at the best price. |
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| Obstacles that can restrict access to a market and limit competition. |
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| The initial expense of launching a business. |
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| Any market structure in which producers have some control over the price of their products. |
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| Unlike competitive firms, these monopolistic businesses are the opposite of price takers. |
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| Combinations of firms that worked together to eliminate competition and control prices. |
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| Federal and state statutes designed to promote competition among businesses. |
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| A contract issued by a government entity that gives a firm the sole right to provide a good or service in a certain area. |
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| A legal permit to operate a business or enter a market. |
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| This type of monopoly arises when a single firm can supply a good or service more efficiently and at a lower cost than two or more competing firms can. |
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| This term refers to the greater efficiency and cost savings that result from increased production. |
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| The proportion of the total market controlled by a set number of companies. |
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| In an oligopoly dominated by a single company, that firm may try to control prices through this. |
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| When the other firms also lower their prices. |
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When producers get together and make agreements on production levels and pricing. |
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| An organization of producers established to set procution and price levels for a product. |
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Favoring one company over all others. |
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| The market seeks to distinguish the goods and services from those of other firms, even when those products are fairly close substitutes for one another. |
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Using product differentiation and advertising to attract customers. |
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The proportion of total sales in a market. |
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| A cost that falls on someone other than the producer or consumer. |
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A benefit that falls on someone other than the producer or consumer. |
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Results when technical knowledge spreads from one company or individual to another, thereby promoting further innovations. |
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Goods and services that are sold in markets. |
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Anyone who does not pay for the good can be excluded from using it. |
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| Not being able to prevent some people from using goods, for example, streetlights. |
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| A good cannot be consumed by more than one person at the same time. |
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| A good can be used by more than one person at the same time. One person’s use of a product does not diminish another’s ability to use the same thing. |
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| When private firms have no way to make people who benefit from nonrival and nonexcludable goods pay for them. |
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