Market Structure and Competition
Important Vocabulary
- Market share: A company's sales expressed as a percentage of the total market
- Promotions: Short-term tactics designed to stimulate stronger sales of a product
- Monopoly: The situation in which there is only one seller of a product
- Competitors: Companies offering similar goods or services to the same set of customers
- Slogan: A short and easily memorized phrase used in advertising
- Market segmentation: The division of a market into submarkets according to the needs or buying habits of different groups of potential customers
- Niche: A small and specific market segment
- Differential advantage: A factor that makes you superior to competitors in a certain respect
- Turnover: A business's total sales revenue
- Recession: A period during which an economy is working below its potential
Matching up the Words With the Definitions Below
[ barriers to entry | cartel | dominant-firm oligopoly | economies of scale | monopolistic competition | monopoly | monopsony | natural monopoly | oligopoly | perfect competition ]
- Perfect competition exists when products are homogenous, and there are a great many firms too small to have any influence on the market price, and firms can easily enter and exit the industry.
- A monopoly is a market in a particular product in which a single producer can fix an artificial price.
- Monopsony is the situation in which there is only one buyer.
- A natural monopoly is an industry in which the efficient existence of more than one producer is impossible; examples include public utilities such as water, gas, and electricity, where it would be inefficient to have several competing companies laying their own networks of pipes or cables.
- Monopolistic competition exists when many producers of slightly differentiated products can sell them at well above the marginal cost.
- An oligopoly is a concentrated market dominated by a few large suppliers. This is very frequent in manufacturing because of economies of scale and the cost barriers of entering an industry.
- Economies of scale are factors that cause the average cost of producing something to fall as output increases.
- Barriers to entry are economic or technical factors that make it difficult or impossible for firms to enter a market or compete with existing suppliers.
- A dominant-firm oligopoly is one in which a market leader can indicate its preferred price to smaller competitors.
- A cartel is a group of producers or sellers who fix prices and quantities to avoid competition and increase profits. This is illegal in many countries, most notably the USA.
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More Important Vocabularies!
Extracted From:
MacKenzie, I. (2002). English for Business Studies: A course for Business Studies and Economics students (Second). Cambridge University Press.
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