The assumptions of        include: Many sellers and    , each too small to influence the market supply / demand and hence market    .  All firms sell the same     (identical) product, hence no        .   Perfect     for both buyers and sellers.

price  homogenous  perfect  buyers  knowledge  loyalty  competition  brand 

In the     run all firms in perfect competition make     profit because of freedom of     and     into and out of the industry.

 short  exit  normal  entry  firms  long 

All firms in perfect competition are     efficient in both the short and long run because they produce where   = MC.

 AR  AC  allocatively  MR 

The following are all sources of monopoly power –   of scale, natural    , legal barriers and brand   .

 loyalty  economies  diseconomies  monopolies  returns to scale 

Many governments throughout the world consider any business which controls at least    % market share to be a monopoly?

25  50  100 

One clear advantage of a perfectly competitive firm is that in situations where the monopolist is not receiving significant             the chances of the     being exploited are lower.

economies  of   diseconomies  increasing returns  scale  consumer 

Another disadvantage of         markets is that firms do not have the incentive to innovate or add additional features to the product.

 perfectly  imperfectly  competitive 

A firm will maximise profits at where    =   , maximise revenue at where    =   and unit sales at where AR=  .

MR  AR  0  AC  greater than MC  MR  MC

The difference between firms in         and perfect competition is that in the former the goods and services sold are very similar but not homogenous.  They are not    efficient in the       .

allocatively  short  long  run  monopolistic  monopoly  competition

within monopolistic competition is caused by the brand     of customers in the market, rather than any attempt by the firms to restrict supply to force up prices.

Efficiency  Inefficiency  loyalty 

An     is a market structure where a small handful of firms dominate the industry, generally between    and 8.  However more significant than the number of firms within the industry is the    ratio.

2  concentration  oligopoly  monopoly 

All firms within an oligopoly share an     relationship.  This means that each firm moves only after first carefully considering their opponents response to such a move.

interdependent  independent  cooperative 

A strategy is one that is always better than any other strategy, regardless of any other firms actions.

cooperative  dominant 

Firms in regularly ignore the     placement level and set up right next to each other, so that they keep an eye on what their competitors are doing.

oligopoly  monopoly  optimum  productively  socially 

 collusion involves firms openly colluding with each other.    is more secret collusion.

Covert  Overt  Tacit 

 collusion is non official collusion exits when firms within the same industry set standardised practices making competition more difficult.

Covert  Overt  Tacit 

Vouchers, loyalty points, customer service and product differentiation are examples of    -      .

competitive  non  price  competition