Posts tagged perfect competition
Describe pricing and output policies in perfect competition and monopoly
May 13th
First, you need to find out answers to the following broad questions:
- What is perfect competition?
- What is a monopoly?
The video below is a very good starting point. You can ignore the early bit on costs.
Activity 1) Research how these two market types set their price and output. Can they control these two things (price and output)? If so, how? If not why not? Can you find simple diagrams to help explain these. Be careful though – this can lead to complex economics that is not needed for IGCES economics. You don’t need diagrams which include marginal cost, marginal revenue, etc, Check with your teacher if possible.
Activity 2): Create two collage images, made up of photographs you have found online, ideally those with a creative commons license (you are going to publish your collage online). one for perfect competition and one for monopoly to show a range of examples and characteristics of each type of market structure. As part of this, make sure you include images to help explain your answer to Activity 1. Ensure that the image size is maximum 5MB for each collage.
Activity 3): Sign up for an account at Thinglink. Upload your images and make them interactive, such that they reveal the key aspects of perfect competition and monopolies. Make sure you also include your answer to Activity 1.
Perfect Competition
Jan 25th
The IB Economics syllabus requires you to understand the following:
• Assumptions of the model
• Demand curve facing the industry and the firm in perfect competition
• Profit-maximizing level of output and price in the short-run and long-run
• The possibility of abnormal profits/losses in the short-run and normal profits in the long-run
• Shut-down price, break-even price
• Definitions of allocative and productive (technical) efficiency
• Efficiency in perfect competition
This selection of resources is designed to compliment your learning of this topic, with a focus on video clips and interactive resources.
Via: http://www.reffonomics.com
This is a very good interactive diagram to try out different scenarios buy adjusting the D=AR=MR line and/or the quantity produced.
Excellent interactive exploration of the relevant theory with multiple choice quiz questions to test your understanding(click on the image)
Via http://openmultimedia.ie.edu created by Javier Carrillo
mjmfoodie on Perfect Competition:
pajholden on equilibrium in perfect competition (click here to view)
richardmckenzie offers two detailed videos:
ACDCLeadership does his usual 60 seconds take on things:
Markets
Sep 13th
What is a market?
View this slideshow to prompt discussion / thought about what the phrase ‘market’ can mean in Economics:
MS Powerpoint version of above: http://opengecko.com/resources/economics/markets/Markets.ppt
MJMFoodie introduces the concept of markets and explains the importance of the price mechanism (but does not yet explain how that actually works … that comes later ..,):
We now need to understand the structure of the market. We can say that there are different types of market which lie somewhere along a spectrum of market structures. There are two theoretical extremes to this spectrum (perfect competition and monopoly).
Again, a useful instructional video by MJMFoodie should provide guidance here:
Now see if you can apply your understanding from the above to the images in this slideshow:
MS Powerpoint version of above: http://opengecko.com/resources/economics/markets/Market%20Structure.ppt
