1. Characteristics of Different Market Structures

a. describe characteristics of perfect competition, monopolistic competition, oligopoly, and pure monopoly;

What are the five characteristics that affect the nature of competition and pricing? 1. The number of firms (including the scale and extent of foreign competition). 2. The extent of product differentiation (which affects cross-price elasticity of demand). 3. The pricing power of seller(s). Can a firm influence the market price? 4. Barriers to entry. Exit costs should also be considered. 5. Non-price competition such as product differentiation.