Markets and market structures

What is a market? Market is any arrangement people have for trading with one another.

What do economists mean by the market structure? The conditions under which competition exists in a market are called/referred to a market structure.

What are the principal types of market structures? The principal kinds of market structures are perfect competition, monopolistic competition, oligopoly, and monopoly

What is perfect competition? Perfect competition (Pure competition): A market for uniform products in which there many buyers and sellers, no one of which is big enough to affect the price, and has full knowledge of market conditions.

What are the key characteristics of perfect competition?

• A large number of buyers and sellers all engaged in the purchase and sale of exactly the same commodity.

• Identical commodity offered for sale.

• Each buyer or seller has perfect knowledge of market prices and quantities.

• There are no barriers to entry or exit.

What is monopolistic competition? Monopolistic competition: A state of competition in a market in which many firms compete, producing similar but slightly differentiated products.

• What are the key characteristics of monopolistic competition?

• a large number of firms producing similar but not identical products;

• product differentiation;

• some restrictions of information about market prices and quantities of goods;

• a relatively easy entry to the market.

What is product differentiation? Product differentiation: A process of creating uniqueness in a product.

What is oligopoly? Oligopoly: A term applied to markets dominated by a few large firms.

What are the key characteristics of oligopoly?

The high cost of entry

patent protections

price leadership, collusion, and custom to determine pricing policies.

What is monopoly? Why does monopoly exist? monopoly is defined as a single firm producing unique products for which there are no close substitutes.

What is imperfect competition? Imperfect competition: A market in which there is neither pure perfect competition nor pure monopoly.

How does imperfect competition differ from perfect competition and monopoly? Imperfect competition describes markets in which sellers have more freedom to determine prices than they have under perfect competition, but less than they have under monopoly.

The economy of ukraine

1. When did Ukraine gain its independence? Ukraine gained its sovereignty in 1991 on the break up of the former Soviet Union.

2. What problems did Ukraine face at the beginning of its independence? When become independent the young country faced a number of simultaneous challenges and had to go through highs and lows¹ within the context of the Ukraine's transition to a market economy.

3. What are the biggest cities of Ukraine and what are they famous for? The world’s largest rocket factory is located in Dnipropetrovsk. Airplanes are produced by the world’s famous company named after Antonov. The best tanks are produced in Kharkiv. The main shipbuilding factories are based in Mykolaiv and Kerch.

4. What are the main industries of Ukraine’s economy? It has a major ferrous metal industry, producing cast iron², steel, and steel pipe, and its chemical industry produces coke, mineral fertilizers, and sulfuric acid³.

Which industries contribute to GDP of Ukraine most of all? What industries are the most export oriented? Coal and ore mining, chemical refining, and electricity production constitute 60 percent of GDP. Besides metals the main exports include: tractors, machinery, building materials, chemicals, consumer goods, crops and fertilizers.

4. What are the most important sectors of Ukraine’s industrial production? Ukraine's machine building produces ships, spacecraft, aircraft, locomotives, machine tools and mining equipment.

5. What are the most important branches of Ukraine’s agriculture? crop production, Cattle and pigs, Sheep and goats

6. What is the position of Ukraine in the world’s grain market? Grain output is almost 1 ton per person. Ukraine ranks as a leading wheat-growing country.

7. What are the main crops cultivated in Ukraine? What crops does Ukraine export? wheat, such grains as barley, corn, legumes¹, oats, rye², millet³, buckwheat⁴ are grown. Other food crops include potatoes, vegetables, melons, berries, other fruit, nuts, and grapes.

8. What are Ukraine’s main exports and imports? main exports and imports include: tractors, machinery, building materials, chemicals, consumer goods, crops and fertilizers.

9. What can promote a suitable climate for persistent growth of Ukraine’s economy? These account for higher potential for considerable progress in agricultural production.

What are the priorities of the government’s activity? foreign investments in agribusiness are also rather important for the country’s economy

4. What should be the priority of the government – Euro 2012, stable local currency, social protection or something else? Why? Prove you opinion.