Principles of Microeconomics EC0204
United States is the number one largest country where it functions some of the largest firms in the world. There is a marvelous connection of foreign trade, good or bad, but the United States has a firm holds on tariffs, so therefore we have to deal with the tremendous request for supply and demand. This essay will discuss the extent to which corporate competition plays a tremendous effect on the U.S and other foreign countries and the characteristics of a perfectly competitive industry both in the short and long run. Following that, this essay will elaborates on how high the entry barriers into a market will influence one another and the characteristics of a perfectly competitive industry. Comparison between perfect monopolist market, an oligopoly and monopolistic along with examples will also be given to further illustrate the best market structures that better compliments the United States... It will then be held in conjunction with, according to Kapsillar, Jakob, Pudringer and Stephen, “One approach to resolve the alleged contradiction is to analyze the price-taking behavior of firms in the framework of perfect competition by comparing the difference between the elasticity of quantities for a single firm (ei = (P/qi) E and the whole industry (E= (P/Q) E when e>E,”). (Kapillas, Jakob, Pudringer and Stephen. para. 16). However this concept does not fit the characteristics of just only one perfectly competitive industry or only oligopoly and the only similarity between competition is the large number of participants involved..
“There are two approaches to studying oligopoly and trade: partial and general equilibrium,” as stated by, (Ruffin, Para. 3). The characteristic of a large number of firms is satisfied when each firm in a market has no significant share of total output and has no ability to affect the product’s market price....