Economics Paper Essay Example | Topics and Well Written Essays - 750 words

Economics Paper - Essay ExampleThe product or service a planetary house offers is usually the only one present in the market, at that placefore, the distinction among a firm and an industry becomes blurred. The firm becomes synonymous to its product/service and to the industry.monopolistic market deviates from a perfect competition market. A perfect competition market is characterized by infinite number of competing firms, many another(prenominal) product/service offerings, and perfectly elastic demand, to name a few. Monopolistic market, on the other hand, has a single firm, bound number of product/service, and a relatively inelastic demand. The differences between the two argon greatly felt from the point of view of the consumer in a monopolistic market who has a limited choice of product/service, supply, and unregulated worth.Since the product/service offered by a firm in a monopolistic market is usually the only available choice, product/service substitutes are usually abse nt. It is rocky to find a product/service that closely resembles the one offered by a firm in a monopolistic market. Consumers are left with a choice of either buying the product the firm offers, buy a poor substitute (if a competition is present), or not buy at all (which is unlikely since the product/service offered in a monopolistic market is usually a basic need or commodity).A firm in a monopolistic market determines the price since it is the only supplier present. As opposed to a perfect competition environment where buyers/consumers dictate the price, a firm in a monopolistic market has the solitary control of price (i.e. price maker). Where there are more players in the market, more choices are offered to consumers hence, the power to control the price is left at the hands of consumers. In a monopolistic market, the power lies in the hands of a single firm.Monopolistic competitive market is occupied by many competing firms while