A2 Microeconomics: definitions.

Fixed Costs (FC): costs not dependent on amount produced (eg: rent, utility bills).

Variable Costs (VC): costs that do depend on how much is produced (raw materials,

Perfectly competition: market structure with many firms that produce homogeneous goods and have perfect knowledge (eg: buyers can find out how much each firm in this market structure is charging for the same good through internet).

Monopolistic competition: Like perfect competition but goods are SLIGHTLY DIFFERENTIATED.

Oligopoly: many firms but only a few firms DOMINATE the market.

Monopoly: where only one firm opertaes in the industry (ie: the firm is the industry).

Natural monopoly: industry only able/profitable to support one firm (usually railway/utitility firms such as gas/water).

Monopsony: only one buyer in the market but many sellers.