Q.List the four criteria economists use to classify market structures, and use them to briefly distinguish perfect competition from monopoly.

The four criteria are number of sellers, nature of the product, entry/exit conditions, and control over price — apply each to contrast the two extremes.

The four classification criteria are: (1) number of sellers, (2) nature of the product, (3) freedom of entry and exit, and (4) the seller's control over price.

Economists classify market structures using four criteria:

1. Number of sellers — how many firms sell the product in the market.
2. Nature of the product — whether all firms sell an identical (homogeneous) product or slightly different (differentiated) versions.
3. Freedom of entry and exit — how easily new firms can enter the industry, or existing firms can leave it.
4. Control over price — the extent to which an individual seller can influence the market price by its own action.

Applying these to the two extreme structures:

Perfect competition thus represents the most competitive extreme (many small, powerless sellers), while monopoly represents the least competitive extreme (a single seller with substantial market power) — the two other structures, monopolistic competition and oligopoly, lie between these extremes on all four criteria.

Students sometimes list only "number of sellers" as the distinguishing feature and ignore the other three criteria — a market with few sellers is not automatically an oligopoly, and a market's true classification requires checking product homogeneity and entry conditions too, not seller-count alone.