Type of Markets in Economy

Different types of markets A monopoly is a type of market in which there is only one producer or seller for a product. Therefore, the only activity is the business. It is quite hard and limited to gain access to this type of industry because usually, one entity has all the rights on a natural resource. Also, this type of market can be limited because of the high cost of material, or simply because of political, social or economical issues. Therefore, a monopoly controls all the good or services for a market. The entry to the market is strictly restricted for all new producers. The monopoly usually keeps the price high and restricts the outputs. A monopoly market imposes the price control and takes over their ownership. Since there is no competition, the price for a product will tend to increase while the supply given by the sellers will decrease. There are quite a lot of advantages of a monopoly market. First off, monopolies tend to become dominant in their own territory. In which case, they will earn a country valuable export revenues. (Microsoft) Also, a monopoly usually increases technological improvement due to the high profit boots. However, this type of market also has disadvantages to the consumer such as the increase of a product’s cost and the number of choices the consumer has.

On a second hand, a duopoly is a type of market that is basically the basic of an oligopoly. It is considered a situation in which two companies have all the power on the market’s products or service. Therefore, a duopoly can have the same impacts as a monopoly, only this time, the two companies are deciding the price range for a product and the profits of their sales are then called profits.
There are two different types of duopoly markets. The first one would be the Cournot’s model in which “the competition between the two companies is based on the quantity of product supplied.” The second type of a duopoly is the Betrand’s model. This model says that