This document discusses market structure and types of market competition. It defines market structure and describes the characteristics of perfect competition, monopoly, monopolistic competition, and oligopoly. Perfect competition is defined as a market with many buyers and sellers and a homogeneous product. Monopoly is a market with a single seller and no substitutes. Monopolistic competition has many sellers of similar but differentiated products. Oligopoly has only a few large sellers dominating the market.

1. PRODUCT MARKET
STRUCTURE
Chapter Three

2. LEARNING OUTCOME:
To be able to describe and present the market
opportunity for a new product or service in terms of
its potential users, as well as its competing and
complementary products and services.

3. LEARNING OBJECTIVES:
At the end of this chapter, the learner will be able to:
1. define the Market Structure;
2. know the types of market competition and its
characteristics; and
3. analyze new product development stages and its
strategies

4. INTRODUCTION
◦ The definition of market structure is a method for providing hypotheses investigating
market situations with some framework. Economists deposited the three most familiar
elements of the market structure as the number, scale, and size of seller and buyer
distribution, the degree of product differentiation, and the entry criteria into the market
requirements for entry into the market. The "place of competition to the firm" is the
setting or "market structure.” The nature of the market is the environment in which the
business achieves competitive 'discipline' or in which the competition law is made
effective. Therefore, one can assume that the relevant, a limited number of strategic
environmental factors affecting al] fundamental choices are involved in the market
structure. In the broader image of the company's setting, the definition of market
structure is included.

5. DEFINITION
◦ Market structure in economics explains how businesses are distinguished
and categorized based on the types of products they offer and how
external influences and components influence their operations. The system
of the industry makes the features of diverse markets easier to grasp.
◦ The product type is a product category or product classification that offers
a specific set of benefits intended to satisfy a customer's need or want in a
particular way. Differences in products within a product-type (class)
product-market may exist, creating product-variants.6 For example, they are
electric, gas, and microwave ovens.

6. The market climate can be perceived in three
overlapping contexts:
1. The general setting or institutional climate
(institutional environment)
2. The economic basic conditions (basic conditions)
and
3. The unique setting that listens so directly to the
company affects all significant decisions (market
structure)

7. TYPES OF MARKET
COMPETITIONS

8. PERFECT COMPETITION
It is a market system where, at a uniform price, an
infinitely large number of buyers and sellers compete
freely and sell a homogeneous product. It has infinite
contestability characteristics (no entry barriers), an
unlimited number of manufacturers and customers,
and a tremendous elastic demand curve.

9. Characteristics of Perfect Competition:
1.High number of sellers and purchasers
2.Homogenous product
3.Free entry and exit
4.Perfect business awareness
5.Perfect mobility of factors of production

10. MONOPOLY
◦It is the type of business organization in which a
product for which there are no near
replacements is a single seller.

11. Characteristics of Monopoly:
1.A single seller
2.Products without an alternative
3.Restriction of entry for new firms
4.Price discrimination
5.Small customer option
6.Price above marginal cost

12. MONOPOLISTIC COMPETITION
◦It refers to a market structure with a relatively large number of
vendors selling similar but not identical goods. Monopolistic
competition is when the market is competitive, but it has some
monopoly features. In this type of business, several companies
offer highly differentiated goods. A monopoly rivalry is thus a
business system in which there is no coordination between the
many sellers. Handheld appliances, cosmetics, detergents, forms
of toothpaste, fast food restaurants, clothing stores, etc., are
examples of this industry category.

13. Characteristics of Monopolistic
Competition:
1.Market segmentation
2.Many buyers and sellers
3.Reduced likelihood of minimizing
cost
4.Price setters

14. OLIGOPOLY
◦ The word Oligopoly refers to 'Few Sellers.' Few Sellers' refers to the term
Oligopoly. An Oligopoly is an industry that consists of only a few
businesses or a small number of large companies producing all of its
production. In other words, oligopoly exits are dominated by a market
where few large corporations manufacture a homogeneous or differentiated
product. Since the sector consists of either a few companies or a few large
companies, any adjustment in prices and production by an individual
company is likely to affect rival companies' profits and output. As an
instance of Oligopoly, the car and oil industry, big soft drink companies,
airlines, and milk companies can be cited.

15. Characteristics of Oligopoly:
1. Few companies
2. Interdependence
3. Obstacles to entry on firms
4. Non market rivalry
5. Advertising dependency
6. Uncertainty of demand
7. Product differentiation
8. Sticky prices