1. Warm Up: Why does competition influence price? Look over the products at your desks. Identify the firms’ competition in its industry (as a lot, a little, or none). And then put the products in order from most to least competition.

2. Market Structures The NATURE and DEGREE of COMPETITION among firms in the same industry There are 4 Market Structures 1. Perfect Competition 2. Monopolistic Competitioin 3. Oligopoly 4. Monopoly

3. Make a Table in your notes: Perfect Competition Monopolistic Competition OligopolyMonopoly Products Are Level of Competition Control over Price Advertising Example

4. PERFECT COMPETITION Products Are: – Identical, no name brands Competition: – Lots of small competitors Control Over Price: – No control over price Advertising: – No need, No way to distinguish.

5. MONOPOLISTIC COMPETITION Products Are: – Similar, with name brands Competition: – Lots of competitors Control Over Price: – Some Control when consumer is brand loyal Advertising: – Lots to create differentiations

6. OLIGOPOLY Products Are: – Similar, with name brands Competition: – FEW major competitors Control Over Price: – Some, when consumers are loyal Advertising: – Much, to beat out rival & differentiate

7. MONOPOLY Products Are: – Unique Competition: – None Control Over Price: – Total Advertising: – No need

8. Create a list Write down 4 different goods for each of the Market Structures that we discussed yesterday. Use your white boards and discuss with your groups

9. Spectrum of Demand Elastic: a change in price results in a large change in quantity demanded, many substitutes Inelastic: a change in price results in a little to no change in quantity demanded, few to no substitutes Perfect Competition Monopoly Oligopoly Monopolistic Competition

10. Cut & Paste Logo Time Each group has in front of them: – Paste, scissors and numerous company logos Each student must cut and paste at least 6 different companies and place them on the spectrum varying their elasticities.