Industry Structure and Efficiency
In a general sense we've seen that we can view most industries as characterized by one of four main industrial structures. These are:
- Perfect Competition:
- Many small firms producing identical products in an industry with no important entry barriers.
- A single firm in an industry with extremely high barriers to entry.
- Monopolistic Competition:
- Many small firms producing differentiated products in an industry with no important entry barriers.
- A few firms in an industry with significant barriers to entry whose every decision must be based on strategic considerations of competitors' response.
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