IMPERFECT MARKET. what is an imperfect market? An imperfect market may be termed as the market in which prices of goods and services can easily be influence by the sellers or buyers.
Imperfect market is also called imperfect competition.
The conditions necessary for an imperfect market directly opposed to those of perfect market,
these conditions are:
- The goods are not homogeneous.
- There is no free entry and exit
- There are few buyers and sellers.
- There is preferential treatment
- There is no perfect information
- There is no common price
- Goods are not portable
- Difficulties in the transfer of factors of production.
Types of Imperfect Market
- Monopoly: This is an imperfect market in which there is a single seller of a particular good or service.
- Monopolistic competition: This is a market where there is a large number of producers dealing with different product or services such that no product of one firm is seen as a perfect substitute for that of another.
- Duopoly: This is an imperfect market in which there are only two producers of the same commodity.
- Oligopoly: This is an imperfect market in which there are only few producers or sellers of the same commodity.
- Monopsony: This is the type of market in which there is only one buyer for a product.