Title MARKETS-Perfect Competition.pptx ✅

Markets To a layman, a market means a place from where transactions of goods and services take place. However market in economics has a different connotation. It is a mechanism through which buyers and sellers come in contact with each other either directly or through a middle medium so that transactions of goods and services and transfer of money, capital and other resources take place. Here we will focus on the transactions of goods and services. So here market encompasses the whole world if we look at the interconnectedness of supply chains of production of goods and services among countries. Our focus will be on Micro-Component of the market mechanism.
Classification of Product Markets Markets can be classified under various categories. Some of categories under which they may be classified are: Product Number of firms Entry Relationship Information Efficiency Profit Competition Price Nature of Demand Curve Behavior of Firms (Conduct) These aspects are discussed in the following slides.
Classification of Product Markets Product: Homogeneous or Differentiated. Number of Firms: Many/Few/One. Entry: Costless Entry and Costless Exit. Relationship: Independent or Interdependent. Information: Perfect or Imperfect Information. Efficiency: Economically Efficient/Inefficient or Dynamically Efficient/ Inefficient. Profit: Abnormal/Normal. Competition: Competitive/Anti-Competitive. Price: Price Taker/Price Maker. Nature of Demand Curve: Elastic/Inelastic. Behavior of Firms: Simple/Strategic.