Economics 11

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  • Created by: Gabrielle
  • Created on: 30-12-13 12:04
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  • Monopolistic Competition
    • A market structure in which many firms sell products that are similar but not identical
      • E.g. Restaurants
    • The Long-Run Equilibrium
      • When firms are making profits new firms have an incentive to enter the market
        • Supply Increases
        • Existing firms reduce prices
    • Oligopoly is where competition is between a few
      • The oligopoly price is less than the monopoly price but greater than the competitive price
      • Competition Law designed to disuade collusion
    • Duopoly is an oligopoly with just two members
    • The group of firms colluding is a cartel
    • Game theory is the study of how people behave in strategic situations

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