The Difference between Perfectly Competitive market & monopoly Market are given Below:
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Perfectly Competitive market |
Monopoly Market |
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1. Perfectly Competitive market is the market in
which there is a large number of buyers and sellers. The goods sold in this
market are identical. A single price prevails in the market |
1. Monopoly is a type of imperfect market.
The number of sellers is one but the number of buyers is many. A monopolist
is a price-maker. In fact monopoly is the opposite of perfect competition. |
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2. The average revenue (price) curve under
perfect competition is a horizontal straight line parallel to
OX-axis |
2. The average revenue curve under monopoly
slopes downward and its corresponding marginal revenue curve lie below the
average revenue curve |
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3.under perfect competition price
equals marginal cost at the equilibrium output |
3. under monopoly equilibrium price is greater
than marginal cost |
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4. Under perfect competition marginal revenue is
the same as average revenue at all levels of output |
4. Under monopoly both the AR and MR curve slope
downward and MR curve lies below AR curve. Thus average revenue is greater
than marginal revenue at all levels of output |
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5. A competitive firm makes only normal profit in
the long run |
5. monopolist can make super normal profits even
in the long run |
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6. a competitive firm earns only normal profit |
6. monopoly firm continues earning
supernormal profits |
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7. A perfectly competitive Market Cannot
discriminate prices for his product. |
7. A monopolist can discriminate prices for
his product. |
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8. a competitive firm cannot change
different prices from different buyers . |
8. Elastic ties of demand are different in
different markets. |