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FORMS OF MARKET
Chapter 9
Concept of Market
 Buyers
 Sellers
 Price
 Commodity
 Agreement
Market Structure
 It refers to the types of market in which the
producers or firms operate.
Factors affecting
1. Number of Buyers and Sellers
2. Nature of the Product
3. Knowledge about Market
4. Freedom of Entry or Exit of the firm
5. Degree of Price Influence
Classification of Markets
 Perfect Competition
 Monopoly
 Monopolistic Competition
 Oligopoly
Perfect Competition
 Meaning:
 It’s a market structure in which there are a large
number of producers (firms) producing a
homogeneous product so that no individual firm
can influence the price of the commodity.
Perfect Competition
 Features:
1. Large no. of buyers and sellers
2. Homogeneous Product
3. Free Entry & Exit
4. Perfect Mobility of Resources
5. Perfect Knowledge
6. Absence ofTransport Cost
Monopoly
 Meaning:
 It’s a market structure in which there exits only a
single seller of a product who is sole producer of
the product which has no close substitutes.
Monopoly
 Features:
1. Single Seller
2. No Close Substitute
3. Closed Entry
4. Price Maker
5. Possibility of Price Discrimination
Monopolistic Competition
 Meaning:
 It is the form of market in which there are large
number of sellers of a particular product, with
each seller selling somewhat differentiated but
close product.
Monopolistic Competition
 Features:
1. Large no. of buyers and sellers
2. Differentiated Products
3. Free Entry & Exit
4. Selling Cost
5. Non-price Competition
6. Independent Price Policy
Oligopoly
 Meaning:
 It is that form of market structure in which there
are a few firms selling a product so that there is
intense competition among them.
Oligopoly
 Features:
1. Intense Competition
2. Interdependence
3. Nature of the Product
4. Importance of Selling Cost
5. Barrier to Entry
6. Indeterminate Demand Curve
Demand Curves of Firms
Perfectly Elastic
A. Perfect Competition
B. MonopolisticCompetition
C. Monopoly
A
Y
X
Output
Price
Comparing Different Forms
Forms of market

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Forms of market