Market Structure - Business studies Comp 1

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What is Market Structure?
It is how a market is made up in terms of competitors within it.
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What are the 4 different market structures?
Monopoly, Oligopoly, Monopolistic Competition and Perfect Competition
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Name in order the least to most competitive market structures.
Monopoly, Oligopoly, Monopolistic Competition and Perfect Competition
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What is the definition for Monopoly?
A single provider within a market. The business is the sole supplier to the market and has 100% market share.
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Give an example of a Monopoly business.
United Utilities
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Give 2 characteristics of a Monopoly business.
Any from: They don't worry about competition, they can supply the quantity they wish and set the prices they wish, they aspire to obtain power, try to maximmise profit and they are protected by barriers to entry.
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Give 2 advantages of a business being Monopoly.
Any from: no/little competition, ability to set prices, economies of scale and high profits.
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Give 2 disadvantages of a business being Monopoly.
Any from: they are closely watched by competitors and market authority and the business will get a negative image if seen as exploiting consumers.
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What is Oligopoly?
Oligopoly is where a small number of businesses dominate the market and are inter-dependent with eachother.
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Give 3 examples of an Oligopoly business.
Pepsi, Coca Cola, Mercedes
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Give 2 key characteristics of Oligopoly market structure.
Any from: there are many businesses but few dominate market, strong brand identity, some barriers do exist and prices can be stable but price wars still do occur.
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Give 2 advantages to consumers for a business being Oligopoly.
Any from: large size of business can lead to economies of scale so lower prices, viriety & choice and lots of money is spent on innovation to try and gain advantage.
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Give a disadvantage to consumers for a business being Oligopoly.
Cartels can be formed to fix prices (this is illegal but Virgin and BA were accused of this).
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What is Monopolistic Competition?
A market structure where there is a large number of similar businesses in competition with eachother.
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Give two examples of Monopolistic Competition businesses.
Any from: Take aways/ fast foods, hair dressers and legal firms
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Give two key characteristics of monopolistic competition.
Any from: few barriers to entry, products are similar, brand identity is weak, not price takers but have limited control over the prices that they charge.
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What is perfect competition?
Where there is a large number of businesses competing and no one firm is large enough to influence others.
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ive two key characteristics of perfect competition.
Any from: no market or price leaders, have equal access to technology and equal productivity and businesses are free to leave or enter the market at any time as there are no barriers to entry.
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Other cards in this set

Card 2

Front

What are the 4 different market structures?

Back

Monopoly, Oligopoly, Monopolistic Competition and Perfect Competition

Card 3

Front

Name in order the least to most competitive market structures.

Back

Preview of the front of card 3

Card 4

Front

What is the definition for Monopoly?

Back

Preview of the front of card 4

Card 5

Front

Give an example of a Monopoly business.

Back

Preview of the front of card 5
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