Differentiating

Market Structures
Learner’s Module in Applied Economics
Quarter 1 ● Module 5

MARINA D. TABANGCURA
Developer

Department of Education • Cordillera Administrative Region

NAME:________________________ GRADE AND SECTION ____________

TEACHER: ____________________ SCORE _________________________
 Department of Education • Cordillera Administrative Region
Republic of the Philippines
DEPARTMENT OF EDUCATION
Cordillera Administrative Region
SCHOOLS DIVISION OF CAR
Wangal, La Trinidad, Benguet

Published by
Learning Resource Management and Development System

COPYRIGHT NOTICE
2020

Section 9 of Presidential Decree No. 49 provides:

“No copyright shall subsist in any work of the Government of the Philippines.
However, prior approval of the government agency of office wherein the work is
created shall be necessary for exploitation of such work for profit.”

This material has been developed for the implementation of K-12 Curriculum through
the DepEd ,Schools Division of Baguio City. It can be reproduced for educational
purposes and the source must be acknowledged. Derivatives of the work including
creating an edited version, an enhancement or a supplementary work are permitted
provided all original work is acknowledged and the copyright is attributed. No work
may be derived from this material for commercial purposes and profit.

ii
 PREFACE

This module is a project of the DepEd Schools Division of Baguio City through
the Curriculum Implementation Division (CID) which is in response to the
implementation of the K to 12 Curriculum.

This Learning Material is a property of the Department of Education, Schools

Division of Baguio City. It aims to improve students’ academic performance specifically
in Applied Economics.

Date of Development : September ,2020

Resource Location : DepEd Schools Division of Baguio City
Learning Area : Applied Economics
Grade Level : 12
Learning Resource Type : Module
Language : English
Quarter/Week : Q1/W5 and Wk 6
Learning Competency/Code : Differentiate various market structures in terms
of:

a. number of sellers
b. types of products
c. entry/exit to market
d. pricing power
e. others.
(ABM_AE12-Ie-f-5-6)

iii
 ACKNOWLEDGEMENT

The developer wishes to express her gratitude to those who helped in the
development of this learning material. The fulfillment of this learning material would
not be possible without them.

Development Team
Author: Marina D. Tabangcura
Illustrator:

Quality Assurance Team

Loida C. Mangangey EPS -LRMDS
Niño M. Tibangay PSDS- District 3

Learning Resource Management Section Staff

Loida C. Mangangey EPS – LRMDS
Victor A. Fernandez Education Program Specialist II - LRMDS
Christopher David G. Oliva Project Development Officer II – LRMDS
Priscilla A. Dis-iw Librarian II
Lily B. Mabalot Librarian I

CONSULTANTS

JULIET C. SANNAD, EdD

Chief Education Supervisor – CID

SORAYA T. FACULO, PhD

Asst. Schools Division Superintendent

MARIE CAROLYN B. VERANO, CESO V

Schools Division Superintendent

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 TABLE OF CONTENTS

Contents Page
COPYRIGHT NOTICE ................................................................................................ii
PREFACE .................................................................................................................. iii
ACKNOWLEDGEMENT .............................................................................................iv
TABLE OF CONTENTS ............................................................................................. v
Differentiating ............................................................................................................. v
Market Structures ....................................................................................................... v
What I Need to Know ................................................................................................. 2
What I Know ............................................................................................................... 3
Lesson 1: Perfect Competition, Monopolistic Competition, and Contestable
Markets ..................................................................................................................... 4
What’s In .................................................................................................................... 4
What’s New ................................................................................................................ 5
Activity: Race to the finish line! .................................................................................. 5
What’s In It ................................................................................................................. 5
What’s More ............................................................................................................... 8
Activity 1: What type of market is it?........................................................................... 8
Activity 2: Mark my word! ........................................................................................... 9
Activity 3: Worth remembering! .................................................................................. 9
What I Have Learned ............................................................................................... 10
What I Can Do .......................................................................................................... 10
Activity: Planning makes perfect! ............................................................................. 10
Lesson 2: Monopoly, Duopoly, and Oligopoly.................................................... 11
What’s In .................................................................................................................. 11
What’s New .............................................................................................................. 11
Activity : Is more, merrier? ........................................................................................ 11
What’s In It ............................................................................................................... 12
What’s More ............................................................................................................. 14
Activity: The truth will set you free! ........................................................................... 14
What I Have Learned ............................................................................................... 14
Activity: Worth remembering! ................................................................................... 14
What I Can Do .......................................................................................................... 15
Activity: Healthy competition! .................................................................................. 15
Assessment.............................................................................................................. 15
Additional Activity ..................................................................................................... 16
Activity: Set a good example! ................................................................................... 16
ANSWER KEY ......................................................................................................... 17
REFERENCES ......................................................................................................... 18

v
 Differentiating
Market Structures
Learner’s Module in Applied Economics
Quarter 1 ● Module 5

MARINA D. TABANGCURA
Developer

Department of Education • Cordillera Administrative Region

NAME:________________________ GRADE AND SECTION ____________

TEACHER: ____________________ SCORE _________________________
 What I Need to Know
Hello learner! This module was designed and written with you in mind. Primarily,
its scope is to help you analyze and propose solution/s to the economic problems
using the principles of applied economics.

While going through this module, you are expected to:

1. define and explain the types of market structures, and
2. describe the characteristics and distinguish the features of the different
market structures.
Now, here is an outline of the different parts of your learning module. The
descriptions will guide you on what to expect on each part of the module.

Icon Label Description

What I need to know This states the learning objectives that you need
to achieve as you study this module.

What I know This is to check what you already know about the
lesson on this module. If you answered all the
questions here correctly, then you may skip
studying this module.
What’s In This connects the current lesson with a topic or
concept necessary to your understanding.

What’s New This introduces the lesson to be tackled through

an activity.

What’s In it This contains a brief discussion of the learning

module lesson. Think of it as the lecture section of
the lesson.
What’s More These are activities to check your understanding
and to apply what you have learned from the
lesson.

What I have Learned This generalizes the essential ideas tackled from
this module.
What I Can Do This is a real life application of what you have
learned.

Post-Assessment This is an evaluation of what you have learned

from this learning material.

Additional Activity This is an activity that will strengthen and fortify

your knowledge about the lesson.

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 What I Know
Start by being interested to answer the items! Read each question and
answer carefully. Choose and circle the letter of the correct answer.

1. Which refers to the characteristics of a market in where buyers and sellers

operate, and influence economic decisions?
A. Market systems C. Market pricing
B. Market structures D. Market interactions
2. Which comparative environment is ideal for buyers and sellers?
A. Monopolistic competition C. Perfect competition
B. Monopoly D. Oligopoly
3. Which refers to products that are identical or similar?
A. Differentiated C. Heterogeneous
B. Homogeneous D. Customized
4. Which refers to products that are made more attractive or with additional features
compared to similar products in the market?
A. Homogeneous C. Differentiated
B. Customized D. Augmented
5. Which refers to the capability of a person or a group of buyers to spend for goods
and services?
A. Buying decision C. Spending limit
B. Consumer behavior D. Purchasing power
6. A seller or company that follows or accepts the prevailing price of products in a
market is called a ___.
A. Price taker C. Price searcher
B. Price completer D. Price builder
7. What do you call a seller or company that has the power to set the price of certain
products?
A. Price completer C. Price builder
B. Price searcher D. Price taker
8. Which characterizes an industry that has many sellers offering differentiated
products?
A. Perfect competition C. Monopoly
B. Monopolistic competition D. Contestable market
9. These are costs or expenditures made by a seller or a company that cannot be
recovered.
A. Variable costs C. Sunk costs
B. Fixed costs D. Overhead costs
10. Which characterizes an industry that has one seller offering a unique product in
the market?
A. Monopolistic competition C. Duopoly
B. Oligopoly D. Monopoly
11. Which strategy is used when a seller or company aims to increase sales and
attract customers by improving the quality of the product, choosing an accessible
location, or giving an augmented product?
A. Non-price competition C. Open competition
B. Non-price discrimination D. Direct competition

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 12. Which comparative environment refers to having two dominating sellers or
companies in the market?
A. Oligopoly C. Duopoly
B. Monopoly D. Contestable market
13. This refers to sellers or companies experiencing cost advantage, where an
increase in production decreases per unit cost.
A. Marginal utility B. Expanding output
B. Economies of scale C. Economies of production
14. This is a result of collaboration among few sellers on a specific price of products
in the market?
A. Perfect competition C. Contestable market
B. Monopoly D. Oligopoly
15. In this competitive environment, the number of sellers is not important, but the
barriers to entry or exit to market.
A. Contestable market B. Oligopoly
B. Monopolistic competition D. Perfect competition

Lesson 1: Perfect Competition,

Monopolistic Competition, and
Contestable Markets

What’s In
You have learned that in a market, price is an element which affects the
decision to buy and the decision to sell. But at the same time, the decisions to buy
and to sell also influence price changes. Buyers dictate demand and sellers are the
sources of supply. Changes in demand and supply affect the market price. Market
price or equilibrium price is determined where demand is equal to supply or at the
state of market equilibrium. Above the market equilibrium, where there is surplus,
supply is greater than demand which forces the price to decrease. Below the market
equilibrium where there is shortage, supply is less than demand which forces the price
to increase.
Price elasticity helps determine how demand and supply changes when price
changes. It validates that demand and supply may or may not change if there is a
change in price depending on the type of product being bought by consumers and sold
by suppliers. But it must be emphasized that choosing the best value for money is
always important to consumers and suppliers. This is why consumers buying
decisions rely heavily on the changes in price. At the same time, suppliers aim for low
production costs.
Products also have a life cycle which affects market prices and economic
decisions. Prices tend to be high when new products are launched then prices
eventually fall, when the product is no longer popular.

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 As an aspiring young entrepreneur, you have now realized how important it
is to set the right prices for the products you intend to sell if you want to win over your
competitors. You must be knowledgeable about the different competitive
environment existing in a market or what is termed as market structures.

What’s New
Activity: Race to the finish line!
There are so many products and businesses in the market, and as an aspiring
young entrepreneur, you have to be competitive! Think of three (3) specific and
creative ways that will help you win over your competitors. Write your answers until
you reach the finish line. Good luck!

1.

FINISH LINE
2.

3.

What’s In It
Competition is part of life! You take part in school competitions, you play games
with your friends and family, or even join national and international tournaments. The
experience can have different outcomes and effects to you physically, mentally and
even spiritually. The same is true when you choose to become an entrepreneur. You
will be experiencing different levels of competition that will make you and your
community better in all aspects of life.

Competition in economics means a rivalry among sellers or businesses in the

market to obtain more customers and earn more profit. Sellers or businesses create
ways to encourage consumers to use their purchasing power to buy the goods and
services. Purchasing power is the ability of consumers to buy products depending
on their available money to spend. As long as you have money and you are willing to
spend it to buy whatever you desire, you have that purchasing power.

In the business world, there are different degrees or categories of competition

and other market characteristics that influence economic decisions. This is referred
to as market structures. Learning about market structures will help you understand
how sellers and buyers behave. Here in lesson 1, you will learn about perfect
competition, monopolistic competition, and contestable markets. Monopoly,

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oligopoly, and duopoly will be later discussed in lesson 2. These market structures
will be characterized by the number of buyers and sellers, type of products being sold,
entry and exit to market, pricing power, and the access of buyers to product
information.

Products in the market can be homogeneous or heterogeneous.

Homogeneous products are goods or services that are similar and have the same
purposes which give the same satisfaction to consumers. These products are perfect
substitutes of one another. When you go to the Baguio public market, you can find
saba bananas sold by many sellers. This product is a homogeneous product because
it is the same product sold by many fruit and vegetable sellers. The saba sold by Aling
Maria is the same saba sold by Aling Teresa, Mang Pedro, Mang Kanor and so on.
Heterogeneous products, on the other hand, are products that are differentiated or
made with a unqiue attribute which distinguishes them from other competitors’
products. For example, when Aling Maria, Aling Teres, Mang Pedro and Mang Kanor
decided to make toron out of the saba they were selling, each of them thought of a
unique toron filling to compete with one another. Aling Maria made toron with kamote,
Aling Teresa made toron with langka, Mang Pedro made toron with malagkit, while
Mang Kanor made toron with cheese. This time they sold differentiated products
because their toron are made with distinct fillings, allowing their customers to choose
the toron of their liking.

In the market, entrepreneurs may find it easy to start, operate and end
businesses, but there are also circumstances when it can be very difficult. This
depends on the presence or absence of barriers to the entry and exit to a market.
Examples of barriers to entry to a market are high taxes, customer loyalty—when
buyers have product preferences even when new or better products are introduced,
strong brand identity—when existing brands are very popular, and high switching
cost—when changing from one product to a new product is more expensive.
Examples of barriers to exit are difficulty to sell or relocate the business because of
the uniqueness of the business, high cost of leaving the market—costs that go with
closing, selling or relocating a business, and loss of trust and confidence from
customers.

Another factor that differentiates businesses in the market is called pricing

power or the ability of businesses or sellers to influence changes in the price of
products. A business or seller can be a price taker or a price searcher. Price takers
are those that accept and follow the existing market price. They are those who sell
homogeneous products and basic commodities like rice and wheat. Price searchers
are those that have the power to set or identify the price. They are usually makers or
sellers of differentiated products.

Here are now the market structures to be differentiated based on the categories
discussed above:

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 Perfect competition is identified to be the ideal and most competitive market
structure because it many sellers with more opportunities to maximize profit, and at
the same time, many buyers with more opportunities to increase satisfaction. The
table below will show you the characteristics of perfect competition in the different
categories:

Categories Characteristics of Perfect Competition

Number of buyers many
Number of sellers many
Type of product homogeneous
Barriers to entry/ exit low or none
Pricing power price taker
Product information of much or complete information about the product/s
buyers

A perfect example for perfect competition is the existence of online sellers. In

social media alone, there are many “ukay-ukay” retailers where the same kinds of
second hand items are being sold such as clothes, shoes, bags, and appliances.
There are many buyers of ukay-ukay items, and they are able to have information
about the products based on what they read in the posts. If you would want to become
an online seller, it would be easy to start the business. There will also be no
difficulty if you decide to stop. But since there are many sellers and products are
homogeneous, your prices are almost similar which means that you will be a price
taker. You would have to accept and follow the existing price in the online selling
business of “ukay-ukay.”

Next is monopolistic competition. It is the second most competitive market

structure where businesses or sellers offer differentiated products. Non-price
competition is undertaken where differentiation is done. Sellers may attract buyers
through creative advertising strategies or unique packaging. They may use names of
popular personalities in their ads or only reveal the positive attributes of the product.
They could also make packaging that can be re-used. Sellers or manufacturers may
also add special features to an existing product like adding flashlights to ballpens or
personal protective equipment gears (PPEs) made in fashionable designs. Because
these are improvised and differentiated products, sellers or manufacturers may
influence or dictate the price making them price searchers. The table below will show
you the characteristics of monopolistic competition in the different categories:

Categories Characteristics of Monopolistic Competition

Number of buyers many, but lesser than in perfect competition
Number of sellers many
Type of product heterogeneous or differentiated
Barriers to entry/ exit low or none
Pricing power price searcher

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 Product information of few or limited information about the product/s for
buyers advertising to become effective

Another market structure is the contestable market where the number of

sellers is not important, but the barriers to entry and exit to the market. Regardless
of the number of sellers, in a contestable market there must be an ease to start a
business and compete, and the absence of sunk costs. Sunk costs are expenses
in opening and operating a business which cannot be recovered. The absence of sunk
costs will make it easier for the entry and exit of a business in a market. Business
should also have access to the best available production technology. The table below
will show you the characteristics of contestable market in the different categories:

Categories Characteristics of Contestable Market

Number of buyers few or many (not important)
Number of sellers few or many
Type of product homogeneous or heterogeneous
Barriers to entry/ exit low or none
Pricing power price taker or price searcher
Information about suppliers full or complete information
and technology

An example of a contestable market in Baguio City is the transient house/ room

business. If you have a house with spare rooms or living spaces, you may enter the
transient business where you rent out your place to people at a given period of time.
You do not have any sunk cost because you just made profit from what you already
have. You also have an idea when business will be at its peak which will lead you to
improve your facilities or divert to other source of income when business is slow. You
also have the option to accept and follow the existing rent rates, or you may set a
competitive price if you have other facilties that renters may use like a swimming pool
or a garage for their vehicles.

What’s More
Activity 1: What type of market is it?
Determine whether each item is a characteristic of perfect competition (PC) or
monopolistic competition (MC), or both. Circle your answer .

1. Buyers have limited knowledge of the product PC MC

2. Many buyers and sellers PC MC

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 3. Second most competitive market structure PC MC

4. Advertising is critical PC MC

5. Seller is a price taker PC MC

6. Most competitive market structure PC MC

7. Differentiated products PC MC

8. Seller is a price searcher PC MC

9. Buyers have complete knowledge of the product PC MC

10. Homogeneous products PC MC

Activity 2: Mark my word!

Write a brief response to each of the following questions about contestable
market.

1. What is sunk cost? __________________________________________________

2. What is not very important in a contestable market? ________________________

3. What is the pricing power in this market structure? _________________________

4. What makes contestable market similar to perfect competition?

___________________________________________________________________

Activity 3: Worth remembering!

Fill-in the needed information to complete the table below to show the
characteristic of each market structure in the different categories.

Perfect Monopolistic Contestable

Categories
Competition Competition Market

Number of buyers 1. 7. 13.

Number of sellers 2. 8. 14.

Type of product 3. 9. 15.

Pricing power 4. 10. 16.

Barriers to entry/ exit 5. 11. 17.

Knowledge/ 6. 12. 18.

information

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 What I Have Learned
To be properly guided as a consumer or a young entrepreneur, consider the
different market characteristics that influence your economic decisions.
Complete the paragraph by underlining the correct word in the parenthesis.

(Market structures, Competitors) will be characterized by the (number, weight)

of buyers and sellers, (types, prices) of products being sold, (entry , end) and exit to
market , (pricing , competing) power and the access of buyers to (product, feedback)
information.

What I Can Do
Activity: Planning makes perfect!
You are tasked by your entrepreneurship teacher to start brainstorming on how
you will be able to do product differentiation on the following goods. Complete the
plan below by providing specific strategies. Explain your strategy in 3 comprehensive
sentences only.

1. sayote

Product differentiation strategy/plan:

2. ID strap/ lace

Product differentiation strategy/plan:

3. homemade ice cream

Product differentiation strategy/ plan:

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Lesson 2: Monopoly, Duopoly, and
Oligopoly

What’s In
In lesson 1, you learned about perfect competition, monopolistic
competition, and contestable product. The table below shows you the similarities
and differences of these market structures:

Barriers Information
Market Number Number Type of Pricing
to entry/ about the
Structure of buyers of sellers Product power
exit product
Perfect many many similar low price complete/
Competition taker full
knowledge
Monopolistic many many differentiated low price limited
Competition searcher knowledge
Contestable many/ many or similar or low/ price complete
Market few -not few differentited none taker or knowledge
important price on the
searcher technology
and
suppliers

The second part of this module presents the characteristics of the three (3)
other market structures which are monopoly, duopoly, and oligopoly.

What’s New
Activity : Is more, merrier?
You and your other friends came together to discuss how to start a business,
but as you brainstorm you started to agree on certain ideas, but also disagreed on
some ideas. Reflecting on what happened, make a list of the advantages and
disadvantages of starting a business alone and doing business with your friends.

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 DOING BUSINESS ALONE

ADVANTAGES DISADVANTAGES

+ -
+ -
+ -

DOING BUSINESS WITH OTHERS

ADVANTAGES DISADVANTAGES

+ -
+ -
+ -

What’s In It
Aside from perfect competition, monopolistic competition, and contestable
market, there are three (3) other market structures you need to understand:
monopoly, duopoly, and oligopoly. Like in lesson 1, these will be differentiated
according to the number of buyers and sellers, type of product, pricing power, barriers
to entry/ exit to the market, and knowledge about the product or business.

A monopoly is the least competitive market structure because there is only one
(1) seller of a product that has no close or perfect substitutes. Prices of these products
are usually dictated by monopolies. The reasons why monopolies exist are the
following: (1) the company has the only access to resources needed to make the
product, which can be expensive for other companies to produce; (2) the company
has the technology to produce more of the product at a less per unit cost, or each unit
of the product costs lesser to make when a company produces more of it which is
referred to economies of scale; and (3) the company has the legal right or the patent
to produce or sell the product. These are also the conditions that make it difficult for
other companies to enter the market. Monopolies can be problematic because there
is a tendency for prices to increase above and beyond what buyers can afford. This
is especially true when the product or service is a necessity. The table below will show
you the characteristics of a monopoly in the different categories:

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 Categories Characteristics of a Monopoly
Number of buyers many
Number of sellers one
Type of product highly differentiated/ unique; public utilities
Barriers to entry/ exit high
Pricing power price searcher
Buyer information of the limited
product

An oligopoly market structure is dominated by a few sellers or companies.

These companies work interdependently to achieve maximum profits. Collusion
happens among these companies to agree on a price levels, which can be a
disadvantage to consumers because prices are set higher than expected. And
because products of oligopolies are necessities, people have no choice but to buy
them. Take for example oil companies. Producers of oil from around the world agree
on the price of oil and impose the price on consumers. The table below will show you
the characteristics of an oligopoly in the different categories:

Categories Characteristics of an Oligopoly

Number of buyers many
Number of sellers few
Type of product homogeneous or slightly differentiated
Barriers to entry/ exit high
Pricing power price searcher
Buyer information of the limited
product

Finally, duopoly is a market structure with only two (2) sellers or companies,
but in reality, these are the two (2) biggest companies offering the product. Collusions
also happen in a duopoly where the two companies agree on the price to impose on
buyers to achieve maximum profit. The best example of a duopoly is the two very
popular brand of carbonated drinks or softdrinks in the Philippines. Even with the
existence of other small companies, these two giants of softdrinks dominate the
market. The table below will show you the characteristics of an oligopoly in the different
categories:

Categories Characteristics of a Duopoly

Number of buyers many
Number of sellers two dominating companies
Type of product homogeneous or slightly differentiated
Barriers to entry/ exit high
Pricing power price searcher
Buyer information of the limited
product

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 What’s More
Activity: The truth will set you free!
Write TRUE if the statement is correct, and FALSE if the statement is wrong.

TRUE 1. Monopoly is the least competitive market structure.

2. Collusion happens only in a monopoly.

3. Products in a duopoly is slightly differentiated.

4. In a monopoly, the company has limited access to available technology.

5. There are few sellers in an oligopoly.

6. In economies of scale, increasing the production decreases the cost of

producing each additional unit of the product.

7. There are two (2) dominant companies in a duopoly.

8. The main goal of monopoly, oligopoly, and duopoly is to maximize profit.

9. Sellers in oligopoly are price takers.

10. Barriers to entry is high in a duopoly.

What I Have Learned

Activity: Worth remembering!
Fill-in the needed information to complete the table below to show the
characteristic of each market structure in the different categories.

Categories Monopoly Oligopoly Duopoly

Number of buyers 1. 7. 13.
Number of sellers 2. 8. 14.
Type of product 3. 9. 15.
Pricing power 4. 10. 16.
Barriers to entry/ exit 5. 11. 17.
Knowledge/ 6. 12. 18.
information

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 What I Can Do
Activity: Healthy competition!
What would life be without competition? Read and understand the following
statements then in one sentence, explain what each statement personally means to
you. Make sure to relate your insights to the concept of competition. You may
give practical examples if you wish.
1. No competition, no progress.
___________________________________________________________________
2. “The best way to kill competition is to partner it.”
___________________________________________________________________
3. “We rise by lifting others.”
___________________________________________________________________

Assessment
You are amazing! With your knowledge about market structures, match column
A with the correct answer on column B.

A B
1. Result of collaboration among few sellers on a A. Economies of scale
specific price of products in the market. B. Price searcher
2. Refers to products that are made more attractive C. Perfect competition
or with additional features compared to similar D. Non-price competition
products in the market. E. Differentiated products
3. Sellers or companies experiencing cost F. Purchasing power
advantage, where an increase in production G. Sunk costs
decreases per unit cost. H. Monopoly
4. A competitive market environment where buyers I. Oligopoly
and sellers operate, and influence economic J. Price taker
decisions. K. Contestable market
5. The comparative environment is ideal for buyers L. Monopolistic competition
and sellers. M. Duopoly
6. A seller or company that follows or accepts the N. Homogeneous products
prevailing price of products in a market. O. Market structures
7. Products that are identical or similar.
8. A comparative environment refers to having two
dominating sellers or companies in the market.

15
 9. The capability of a person or a group of buyers is
to spend for goods and services.
10. A seller or company that has the power to set the
price of certain products.
11. An industry that has many sellers offering
differentiated products.
12. When a seller or company aims to increase sales
and attract customers by improving the quality of
the product, choosing an accessible location, or
giving an augmented product.
13. Costs or expenditures made by a seller or a
company that cannot be recovered.
14. An industry that has one seller offering a unique
product in the market.
15. In this market structure the number of sellers is
not important, but the barriers to entry or exit.

Additional Activity
Activity: Set a good example!
Match one market structure to each market example listed below. Answers
can be used more than once.
Monopoly 1. One electric company in the city
2. Baguio beans sold in the public market
3. Band X - shampoo
Brand Y- shampoo with coconut oil
Brand Z- shampoo with coconut oil and long lasting fragrance
Brand A- shampoo with free hair gel
4. Two dominant companies of mineral water
5. Companies that produce oil.
6. Candles sold by vendors around the church
7. Tarnsient rooms and houses
8. On-line sellers
9. Showing only the positive side of drinking coffee in an advertisement
10. The only producer of banana stalk pots in a region.

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ANSWER KEY

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 REFERENCES
Internet sources:
Pettinger, Tejfran, 2019. Types of Market Structures. November 28. Accessed
September 7- 11, 2020.https://www.economicshelp.org/microessays/markets/.

Raasch, Jessica. 2008. Economic Workbook. Accessed August 3- 9, 2020.

https://www.freewebs.com/davreisman/Economics%20Workbook.pdf.
Tutor2u.net. Economics: Contestable Market. Accesses September 9, 2020.
https://www.tutor2u.net/economics/reference/contestable-
markets#:~:text=A%20good%20example%20of%20an,including%20UPS%2C
%20TNT%20and%20Yodel.

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