11.1 Identify and explain the characteristics of monopolistic competition.
Relatively large numbers
Easy entry conditions
11.2 Using revenue and cost information, determine the price, output, and profit for a firm in monopolistic competition in the short run.
? Describe the demand curve for monopolistic competitor.
? Calculate profit maximization in the monopolistically competitive market.
RULE OF MR = MC STILL APPLIES
Example: Figure11-1 text page 282
11.3 Describe long-run equilibrium in monopolistic competition.
? Define long-run in monopolistic competition.
? Compare the long-run equilibrium in monopolistic competition to perfect competition.
Example: Figure 11-2 text page 285
Economic Efficiency is P = MC = ATC
Allocative Efficiency P = MC right amount of resources are used for the P
Productive Efficiency P = Min ATC lowest price for the least-cost
Monopolistic Competition is P = MC no under allocation (P above MC) P = min ATC no not min cost
11.4 Identify and explain the characteristics of oligopoly.
Homogeneous or differentiated products
Economies of scale
Barriers to Entry
The Urge to Merge Horizontal Merger Vertical Merger Conglomerate
Example: Four firm sales concentration ratio
11.5 Identify and explain the types of pricing behaviour that can occur in oligopoly.
? Identify game theory oligopolists may use. Best response function
Game theory models