Imperfect Information
No sellers or buyers have complete market information, like market demand or market supply.
| Number of firms | Market power | Elasticity of demand | Product differentiation | Excess profits | Efficiency | Profit maximization condition | Pricing power | |
|---|---|---|---|---|---|---|---|---|
| Perfect Competition | Infinite | None | Perfectly elastic | None | No | Yes | P=MR=MC | Price taker |
| Monopolistic competition | Many | Low | Highly elastic (long run) | High | Yes/No (Short/Long) | No | MR=MC | Price setter |
| Monopoly | One | High | Relatively inelastic | Absolute (across industries) | Yes | No | MR=MC | Price setter |
Read more about this topic: Monopolistic Competition
Famous quotes containing the words imperfect and/or information:
“We can glut ourselves with how-to-raise children information . . . strive to become more mature and aware but none of this will spare us from the . . . inevitability that some of the time we are going to fail our children. Because there is a big gap between knowing and doing. Because mature, aware people are imperfect too. Or because some current event in our life may so absorb or depress us that when our children need us we cannot come through.”
—Judith Viorst (20th century)
“I am the very pattern of a modern Major-Gineral,
I’ve information vegetable, animal, and mineral;
I know the kings of England, and I quote the fights historical,
From Marathon to Waterloo, in order categorical;”
—Sir William Schwenck Gilbert (1836–1911)