Economics
4th Quarter Exam
MARKET STRUCTURE
Market Structure – Competitive environment
in which buyers and sellers operate.
Competition – rivalry among various sellers in
the market.
1. Perfect Competition
- Many buyers and sellers in the market
- Homogenous product is sold by sellers
which means the products are highly
similar; perfectly standardized
- Perfect mobility of resources – Easy
transfer of resources
- There is a perfect knowledge of economic
agents of market condition
- Price is determined exclusively by forces
of demand and supply.
- Describes an imaginary market.
Ex: produce, supermarkets
2. Monopolistic Competition
- Many sellers offer heterogenous
differentiated products; similar
identical. Highly substitutable but are not
close substitute
- Free entry and exit
- Has some control over price and quantity
Ex: cotton swabs, mobile device chargers,
pencils, paper, etc.
3. Oligopoly
- High barrier to entry
i. High cost
ii. Government regulations
- Firms have strong power to dictate a price
- Few large producers (oil company)
- Homogenous or differentiated products
- Interdependence among firms
- The market is dominated by a small
number of strategically interacting firms.
4. Monopoly
- A single seller who has control of the
entire supply of raw materials
- They have control over price since they do
not have competition
- Barrier to entry
i. Economies of scale
ii. Grant of government franchise
Ex: Electricity (Meralco), Water Supply
(Maynilad)
INDUSTRY AND ENVIRONMENTAL
ANALYSIS
Business Organization
1. Sole proprietorship – Simplest way to set
not up a business. Owned by a single
individual
2. Partnership – An agreement in which two
or more person combine their resources to
make profit
a. General Partnership – All owners
share the management of the business
b. Limited Partnership – Some
members are general; skills and
capital, others are limited; capital
only
 Economics
4th Quarter Exam

3. Corporation – A legal entity that is It is important to study all the classification of

separate from its owners; burdened by businesses as to the size on the worth of the
heavy taxes business assets.

Type of Industries - In the Philippines, total assets for micro

business are worth from P1,500,001. For
1. Agribusiness – Generally commercial
the small business, total assets are from
aspects related to agriculture; supported by
P1,500,001 to P15,000,000. Medium
manufacturing and service sector
Business has total assets from P15,000,001
a. Crop production
to P60,000,000. Any business with assets
b. Animal production
in excess of P60,000,000 is considered as
c. Forestry and Logging
large scale.
d. Ec
e. Agri-support services and
manufacturing
2. Manufacturing – Business that takes raw
materials to make a finished product.
3. Retail industry – Companies that sell
goods and services to consumers.
a. Retail trends
b. Consumer spending
c. Market intelligence
d. Loyalty programs
e. Online shopping
4. International Trade – An exchange
involving a good or services conducted
bet. at least two different countries.
Method of economic interaction bet. int.
entities
a. Import – Good or service brought
into the domestic country
b. Export – Good or service sold to a
foreign country.

SMALL, MEDIUM, AND LARGE-SCALE

BUSINESSES