Economics · Ch 6 — Market
Comparative Overview of Market Forms
6
Comparative Overview of Market Forms
The four market forms covered in this Gujarat Std 11 Economics chapter are best remembered by comparing them side by side on the same four features introduced at the start of the chapter — number of sellers, nature of product, freedom of entry, and control over price. The table below summarises this comparison and is a useful revision tool before an exam.
| Feature | Perfect Competition | Monopoly | Monopolistic Competition | Oligopoly |
|---|---|---|---|---|
| Number of sellers | Very large | One | Large | Few (large individually) |
| Nature of product | Homogeneous | Unique, no close substitute | Differentiated, close substitutes | Homogeneous or differentiated |
| Freedom of entry/exit | Completely free | Blocked by barriers | Free | Difficult |
| Control over price | None — price taker | Full — price maker | Limited, due to differentiation | Limited, constrained by rivals' reactions |
| AR–MR relationship | AR = MR | MR less than AR | MR less than AR (AR relatively elastic) | MR less than AR; often rigid |
| Typical example | Foodgrain mandi | Electricity distribution utility | Toothpaste, restaurants | Cement, automobiles |
Definition 1Market Form
One of the recognised categories into which markets are classified by their degree of competition — perfect competition, monopoly, monopolistic competition, and oligopoly are the four mar …