Markets - Barriers to entry

Question 1

What are some barriers to entry

Answer 1

Brand loyalty
Controlling resources/tech
Sunk costs
Capital requirements (i.e up-front investment)
Legal (patented stuff)

Question 2

What are the characteristics of competitive markets like monopolistic(5)

Answer 2

small buyers and sellers
low barriers to entry
same goods
perfect information
lower profits

Question 3

What are the characteristics of oligopolies (non-competitive) (6)

Answer 3

high barriers to entry
high concentration ratio
interdependence of firms - firms will follow each other
product differentiation and non price competition
firm collusion
imperfect info

Question 4

What are the characteristic of a monopoly (non-competitive)

Answer 4

profit maximise
product differentiation high
sole seller
Price setting power

Question 5

Why are competitive markets good for consumers

Answer 5

more choice and lower prices