AP® MICROECONOMICS:
Market Structures

The second Theory of the Firm topic in AP® Microeconomics continues to examine the behaviour of firms and examines how firms behave within the market structure within which they operate. Four types of market structures are considered: perfect competition, monopolies, monopolistic competition and oligopolies. Market structures are essentially based on the degree of competition firms selling a product in the market face. This varies from a single seller in a market (the monopolist) to a situation of 'perfect' competition where there are no barriers to entry and many, many firms compete to sell an undifferentiated product. Price discrimination is the practice of charging different prices to different consumer groups.

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Theory of the firm II: Market Structures  – Topics:

• Perfect competition
  
• Monopoly
  
• Monopolistic competition
  
• Oligopoly
  
• Price discrimination
  

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