The document defines different types of markets and provides examples of each. It discusses physical markets where buyers and sellers interact in person, virtual markets where interaction occurs online, and auction markets where goods are sold to the highest bidder. It also outlines consumer markets for personal goods, industrial markets for business-to-business sales, black markets for illegal goods, and financial markets for trading financial instruments. The document then examines different market structures including perfect competition, monopolistic competition, monopoly, and oligopoly.

1. Market
Structure

2. A forum in which people come together to
exchange ownership of goods, a place where
good or service are bought and sold. Market
may either be a physical marketplace where
people come together to exchange goods and
services. Like as bazaar, shopping center etc.
Virtual market where buyer and seller do
not interact as in online market.
What
is
Market?

3. • Physical Markets
• Virtual Markets / Internet Markets
• Auction Market
• Consumer Markets
• Industrial Markets
• Black Market
• Market for Intermediate Goods
• Financial Market
Types
of
Market

4. Physical
Market
A place where buyers and
sellers physically meet
that involve both parties
in a transaction in
exchange for money.
Departmental Store
Super Market

5. Virtual
Market
Buyers purchase goods
and services through
internet. Buyers and
sellers do not physically
meet.

6. Auction
Market
Seller sells goods to one
who is the highest bidder.
Car Auction
Player Auction
Tea Auction

7. Consumer
Market
Made up of all the people
who make decisions about
what to buy and what not to
buy. It’s about personal
consumption.
Super Market
Departmental Store

8. Industrial
Market
(B2B)
Market involves business to
business sales of goods and
services. These marketers do
not target consumer markets.

9. Black
Market
Where illegal goods like
drugs and weapons are
sold
Black Ticketing
Drugs
Illegal Weapons

10. Market for
Intermediate
Goods
Used as inputs in the
production of other goods
including final goods

11. Financial
Market
Financial market is a
market where financial
instruments are traded.

12. Types
of
Market
Structure

13. • Number of firms
• Homogeneous products
• Barriers to entry and exit
• Perfect Knowledge
• Buyer and seller
• Demand
• Nature of competition
• Price
• Transportation cost
• Profit potential
• Government Involved
• Price taker
Perfect
Competition
Pure or pure competition
market where
equal level for all firm
involved in this industry.

14. Real Life
Example
of
Perfect
Competition
Agricultural Market
Street Food Vendors
Stock Market

15. Supernormal
Profit
in
Perfect
Competition
• Price of commodity is equal to demand, so it
will be P=D=AR=MR.
• If MR>MC firm find itself profitable position
and produce more.
• If MR<MC firm must cut down its production.
• Total Profit by producing the level of output
where MR=MC.

16. Normal Profit
in
Perfect
Competition
Firm make normal profit in long run. Market
equilibrium price will be at a point where all
firms in market will make normal profit. Where
MC=AC=MR. All economic cost & opportunity
cost are being covered.

17. Loss Making
in
Perfect
Competition
Firm making losses in short run. Which means
firm are not covering their total cost. Firm sell
at price P and quantity Q, Where MC=MR.
When cost per unit above price then firm
making loss P to above.

18. Monopolistic
Competition
Pure or pure competition
market where
equal level for all firm
involved in this industry.

19. Real Life
Example
of
Monopolistic
Competition
Restaurant Business
Barber Shops
Hotels and Pubs
Clothing Shops

20. Monopolistic
Competition
VS
Perfect
Competition
Particular Perfect
Competition
Monopolistic
Competition
Price
Determination
Demand and Supply Dominant Firm
Product
Standardization
There is Product
Standardization
No Product
Standardization
Selling Cost Sharing Selling Cost No Sharing of Selling
Cost
Average Revenue
and marginal
Revenue
AR=MR AR>MR
Slope of Demand
Curve
Horizontal Downward Curve
Barriers of Entry
and Exit
No Barriers Low barriers

21. • Single seller
• Unique good with no close substitute
• Price maker
• Barriers to entry
• Full control over supply
• Availability of information.
• Competition
• Profit
• A large number of buyers but only one seller
• Downward sloping demand curve.
Monopoly
There is one seller and
there is no close
substitute to the
commodities sold by the
seller.

22. Real Life
Example
of
Monopoly

23. Advantage and
Disadvantage
of
Monopoly
Advantage Disadvantage
Economies of Scale- Lower
average costs from increased
scale
Higher price for customers
High Profit can be used for
research and development
Allocative inefficiency (P>MC)
Monopoly power can encourage
investment
Decline Customer surplus
Monopoly Firms are successful
and innovative
May also monopsony Power
(Pay Low Wages)
Government can regulate to get
best of both worlds- economies
of scale and fair prices
Monopolies can gain political
power to protect their vested
interests.
Less choice for consumers

24. • Few seller
• Ability to set price
• Barrier to entry or exit
• Interdependence
• Constant struggle
• Lack of uniformity
• Advertising
• Imperfect competition
• Rivals aware of what others are doing
• Downward sloping
Oligopoly
The market where there
are only a few firms(more
than two firms) in the
industry producing either
identical or differentiated
products.

25. Real Life
Example
of
Oligopoly
Soft Drinks
Banking Industry
Food Oil
Airline

26. The Principal
Advantage and
Disadvantage of
Oligopoly

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