Warm Up (turn in political cartoon if you need to) Price __________ is when the government sets the highest price possible. Price __________ is when the government sets the lowest price possible. What are your favorite brands for the following items shampoo, jeans, perfume, and gas? Why? Looking at the cereal boxes, what do the boxes tell you about their market? 1.Ceiling 2.Floors

Types of Markets Economics Standard 12.12.5 Learning Goal: I will understand competition and market structures by evaluating the different structures.

I. Pure/Perfect Competition Buyers and sellers act independently Competing products are basically identical Buyers and sellers are fully informed about prices Price-taker: businesses are forced to take what ever price the market bares (ex., farmers) Large number of sellers & buyers

Farmers face a lot of competition and are often price-takers

Poultry - Chickens

Egg Market

II. Monopolistic Competition A. Product differentiation (seemingly identical products are different from buyers point of view; ex, brand names)

Monopolistic Competition because of your brand

III. Oligopoly Few sellers produce all or most of the supply (ex, General Mills, Post, Kellogg’s) Collusion (agreements to limit competition) Price Leadership (most powerful company sets the price)

Oligopoly’s

IV. Monopoly Single supplier No substitutes Difficult for other businesses to enter the market because… High Costs Control of resources (ex., Aluminum Company of America, ALCOA) Patents or copyrights

Microsoft

Pharmaceutical Companies

Music Industry

Answer the question below under your warm up. 1. What is your favorite cola brand? Why? Cup A Cup B

Answer the question below under your warm up. What is your favorite cola brand? Why? (cup A is by the lava lamp, cup B is at team 10) Cup A Cup B