It is traditional to divide industries into categories according to the degree of competition that
exists between the firms within the industry. There are four such categories. At one extreme is
perfect competition, where there are very many firms competing. Each firm is so small relative
to the whole industry that it has no power to influence price. It is a price taker. At the other
extreme is monopoly, where there is just one firm in the industry, and hence no competition
from within the industry. In the middle come monopolistic competition, which involves quite a
lot of firms competing and where there is freedom for new firms to enter the industry, and
oligopoly, which involves only a few firms and where entry of new firms is restricted.
From the following market structures:
Oligopoly
Requirements:
For the market structure above, write a paper and make a 30 minutes presentation on:
a. The definition of the structure
b. Discuss the feature or characteristics of the structure
c. Outline at least five (5) assumptions of each of the structure
d. State at least five (5) advantages and disadvantages of the chosen structure
e. Outline at least five (5) barriers to entry for the chosen structure
f. Explain how the structure operates in the short run and long run
g. With the aid of a diagram explain how profits are maximized
