Which of the following factors determine the structure of a market?
(a) Nature of commodity
(b) Number of sellers
(c) Use of selling costs
(d) All the above
Answers
Answer:
D all of the above. mark it as brainlist
Answer:
(d) All the above
Explanation:
In economics, market structure is the classification of different industries that are differentiated based upon the following main features:
1. Number of Buyers and Sellers:
This indicates the influence on the price of the commodity. When the number of buyers and sellers is large, individual buyers and sellers cannot influence the price of the commodity. However, when there is a single seller or very few sellers, then the sellers have the power to control prices.
2. Nature of the Commodity:
In case of homogenous commodity, the price is invariable. However, if the commodity has a distinguishing feature then the prices may vary. Also, if the commodity has no substitute then the seller is incharge of the pricing.
3. Freedom of Movement of Firms:
If the entry and exit of firms is upon will, then the prices will be stable. However, when there are restrictions on entry and exit of firms, then the firms can sway the prices due to no fear of competition.
4. Knowledge of Market Conditions:
If the buyers and sellers are well aware, then the prices are stable. However, if there is lack of knowledge then, sellers can exploit this and charge higher prices.
5. Mobility of Goods and Factors of Production:
With the mobility of factors of production one place to another freely, the prices remain constant. However, immobility of goods and factors may result in higher or different prices.
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