Discuss one or more market structures that you think are interesting relevant
The term market structure refers to all the features that may affect the behaviour and performance of the firms with a market. ... The main market structures are broken down into four main categories; perfect competition, monopolistic competition, oligopoly and monopoly. Each of these structures operates under a set of clearly defined rules. The market structure chosen for the course of this essay is that of monopoly, both the positive and negative aspects will be discussed. A monopoly occurs when there is one dominant firm within a certain industry. ... This is clearly because if there are no other firms in the market, there is no competition, therefore the firm with monopoly power will be able to maximise profits quickly and its profits will always remain high as it does not have to compete with the prices of other firms for the specific output it produces. ... Under monopoly there is only one main firm, therefore no real drive to constantly update efficiency since there is no competition. ... Since the monopolist is the only supplier of a product, the monopolists’ demand curve is also the market demand curve. ... It is evident that there is a clear formation of huge networks that keep growing dominated by one firm. ... This means that the monopolist can be in control of one factor but not another. ... Given that there is one dominant firm under monopoly, the firm therefore does not have to engage in price competition and thus a firm operating with monopoly power can theoretically keep prices low.