Characteristics

Market Homogeneous
Entry
Structure Number of Barriers or
Number of Sellers and Exit
Buyers to Entry Differentiated
Activity
Product?
Homogeneous
Yes, firms
product, all
have the
Pure Many goods are
Many firms None freedom
Competition buyers perfect
to enter
substitutes for
and exit
consumers
Differentiated
products, but
Yes, firms
close
Many firms with non- have the
Monopolistic Many substitutes for
interdependent pricing and Very low freedom
Competition buyers consumers so
quantity decisions to enter
their demand
and exit
curves are
elastic
Difficult
Products can
entry
Few firms be either
(often due
Oligopoly with interdependent pricing Unspecified High differentiated
to
and quantity decision or non-
economies
differentiated
of scale)
A single,
homogeneous
Pure entry
Single seller Unspecified Complete product with
Monopoly blocked
no close
substitutes

Characteristics
Market Draw the
Price Taker
Structure Short Run Long Run demand
or Price
Profits? Profits? curve facing
Searcher?
the firm
Price Taker -
the firm
Pure Perfectly
Available No chooses
Competition elastic
quantity but
takes price
 from the
market

Very elastic,
but not
perfectly
Monopolistic Price
Available No elastic
Competition Searcher
because close
substitutes
exist
Available if entry
is blocked and the
Inelastic, to
colluding cartel
Price be an
Oligopoly Available holds together
Searcher effective
(This is unlikely
oligopoly
because cartels
tend to fall apart.)
Inelastic, to
Pure Price be an
Available Available
Monopoly Searcher effective
monopoly