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:
“Art is a reality, not a definition; inasmuch as it approaches a reality, it approaches perfection, and inasmuch as it approaches a mere definition, it is imperfect and untrue.”
—Benjamin Haydon (1786–1846)
“Knowledge is of two kinds. We know a subject ourselves, or we know where we can find information upon it.”
—Samuel Johnson (1709–1784)
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