Bring one's eggs to a bad market
Bullion market
Corner the market
Drive one's hogs to market
Go to market
Make a market of smth.
Marriage market
Miss one's market
Play the market
Rig the market
6. Answer the questions and get ready to speak about Types of Market.
1. What is a market?
2. How can a market be defined?
3. What aremarkets dependent on?
4. Are physical markets still vital?
5. What marketplaces have become the largest and the most liquid?
6. What has become known as the law of supply and demand?
7. How can markets appear?
8. How do free markets operate?
9. When do governments or trade bodies step in?
10. What are the currency markets?
11. Why have stock markets become highly complex markets?
12. What did street markets develop into?
13. What underpins economic activity?
14. What do commodity markets include?
15. What do capital goods markets help?
7. Read and translate the following text.
TYPES OF BUSINESS FIRMS AND TYPES OF MARKET BY COMPETITION
OF THE UNITED STATES
Perfect Competition
A perfectly competitive market is characterized by the following:
There are so many buyers and sellers that each exchange deals only with a tiny fraction of the total amount of products in the market.
All firms sell identical, or homogeneous products.
Perfect information is assumed, that is, buyers and sellers are fully informed with the price and availability of all resources and products.
No obstacles exist to block the free entry and exist of firms and resources.
If these conditions are present in a market, individual participants will have no control over the price, which is solely determined by market supply and demand. Buyers and sellers are all price takers in that they have no ability at all to affect it but to "rake", or accept it as given. They are free to buy and sell, though, whatever amount that may maximize their interest. Nevertheless, no matter how much they buy or sell, their relative smallness to the market gives them no chance to have perceptible effect on the market price.
These characteristics limit the decisions open to competing firms and simplify the analysis of competitive behavior, but such a market as this can never be found in reality. In real world, firms do have some degree of control over price and the products vary; new firms cannot enter a market freely because of natural barrier or artificial barrier. Monopoly is one of them.
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Monopoly
Monopoly is just the opposite of perfect competition, a market or industry in which only one firm produces a product for which no close substitutes exit. Monopolists are subject to market discipline, but they can set prices based on the quantity it will supply. For it to remain the sole provider of a good or service, a monopolist must find some way to prevent new entrants from entering the industry. Sometimes it is the government that erects the barriers to entry. They grant an exclusive license to one producer on a particular product. For example, in the United States, such public utilities as electric power and gas companies, most of which are privately owned, have traditionally been shielded by the government from competition. Sometimes, however, a producer is endowed with an exclusive access to a natural resource that can be found nowhere else. If a jewelry company in South Africa acquires a unique deposit of blue diamonds, it becomes a natural monopolist of the blue diamonds in the world.
Monopolistic Competition
A market in which many sellers compete to sell a basically the same but differentiated product, and in which new entry is possible is referred to as a monopolistically competitive market. A monopolistic competition has features as following:
Relatively large numbers of firms, each satisfying a small but not microscopic share of market demand with a similar but not identical product.
Firms don't take the reaction of rivals into account when choosing prices and sales targets.
No perfect substitute of other firms can be found for a product by one firm.
Firms don't cooperate, for example, to set prices, block new entries, or to decrease competition. They do not do that.
Relative freedom of entry exists.
Oligopoly
Another important market structure between perfect competition and monopoly is oligopoly, a market dominated by just a small number of firms(oligopolists) and entry of new competitors is difficult or impossible. More than half the market output is made by three or four major firms. Many industries, such as steel, automobile, and oil, are oligopolistic. Their products may be either differentiated or standardized. Since an oligopolistic market has only a few firms, each firm must consider the effect of its own policies and strategies.
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Let's take a look at the characteristics of oligopolistic markets:
Only a few firms supply the entire or nearly entire market with a product that may be standardized or differentiated.
Oligopolists can influence the price.
New entry is difficult or impossible.
Oligopolists are aware of their interdependence and always consider the reactions of their rivals that may be prompted when they select prices, output goals, advertising budget, as well as any other business policy.
As for why some industries evolve into an oligopolistic market structure and some don't, reasons are not very clear. Anyway, an oligopolistic market structure can often be traced back to some form of barrier to entry, such as economies of scale, legal restrictions, brand names built up by years of heavy budget advertising, or control over an essential resource.
By Xiaozhuan Yang, Mingyong Zhang, Yang Yang
8.Answer the questions.
1. What is the difference between Perfect Competition and Monopoly?
2. Give characteristics of monopolistically competitive markets and oligopolistic markets.
9. Sum up the text. Get ready to discuss it.
7. Write an essay giving examples of:
1. Perfect Competition
2. Monopoly
3. Monopolistic Competition
4. Oligopoly
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