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pure competition
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the market structure that exists when there are many small businesses selling one standardized product
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pure monopoly
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A market structure in which one firm sells a unique product, into which entry is blocked, in which the single firm has considerable control over product price, and in which nonprice competition may or may not be found.
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monopolistic competition
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a market structure in which many companies sell products that are similar but not identical, focuses on branding and differentiation
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oligopoly
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A market structure in which a few large firms dominate a market, can be differentiated or standardized
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price taker
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a firm that faces a given market price and whose quantity supplied has no effect on that price; a perfectly competitive firm
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Average Revenue (AR)
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TR/Q
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Total Revenue (TR)
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Price x Quantity
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Marginal Revenue (MR)
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the change in total revenue from selling one more unit of a product
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break-even point
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the point at which the costs of producing a product equal the revenue made from selling the product
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MR = MC rule
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The principle that a firm will maximize its profit (or minimize its losses) by producing the output at which marginal revenue and marginal cost are equal, provided product price is equal to or greater than average variable cost.
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TR-TC
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Profit =
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short-run supply curve
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A supply curve that shows the quantity of a product a firm in a purely competitive industry will offer to sell at various prices in the short run; the portion of the firm's short-run marginal cost curve that lies above its average-variable-cost curve.
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