Applied-Econ Q1 W5 M5 LDS Market-Structures ALG RTP

Republic of the Philippines
Department of Education
REGION I
SCHOOLS DIVISION OF CANDON CITY
Candon City, Ilocos Sur
APPLIED ECONOMICS
Quarter 1 – Week 5 - Module 5
Refined by: Aniceto G. Bacoteng
Lesson
Market Structures
5
I. OBJECTIVE:
1. Enumerate and differentiate the market structures.
II. GUIDE QUESTIONS:

1. What is market structure?
2. What are the four types of market structure?
II. DISCUSSION:
Good day, dear learners! How are you? Are you now ready to learn what’s in this
module?
THE MARKET STRUCTURE IN ECONOMICS

Market structure (market forms) describes the state of a market about competition or
the actual settings in the market. It also refers to the organizational characteristics that establish
interrelationships between the buyers and sellers of a particular market. Thus, the participation
of buyers and sellers is vital. Competition is rivalry among many sellers in a particular market.
As a student, you are always competing with each other like sports, quiz bees, and other
school-related competition activities. Thus, competition may help motivates you to perform
well to achieve your goals in life. The market has impersonal competition among sellers who
compete to sell their goods and services among purchasers who use their purchasing power to
acquire the availability of products.
THE FOUR TYPES OF MARKET STRUCTURE

1. Perfect Competition
This is a type of market form in which more firms sell the same products or render services,
and no one has enough market power to be able to set prices on the product or service without
losing business as the conditions for perfect competition are strict, there are only a few markets
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that are considered to be perfectly competitive thus this market form only exist to compare with
other market forms. A perfectly competitive market assumes a huge number of companies to sell
the same products. We call these companies "price takers" because they have no market power or
ability to control prices.
2. Monopolistic Competition
A market structure that has a large number of firms that offer differentiated products. It is
easy to enter/ exit the market. It is characterized by both perfect competition and monopolistic
competition. The only producers of that specific products. It allows the firm to be a price maker,
it means that he/ she can set the price of their products depending on the differentiation on the firm
products.
3. Oligopoly
It is a form of market structure in which there are only a few firms producing products that
range from slightly differentiated to highly differentiated. Each firm is huge enough to influence
the industry. Barriers to entry exist. Only a few firms dominated the market, but few enough so
each firm alone can affect the market. Entry is possible but is more difficult because of some
barriers like political and costly capital.
4. Monopoly
A monopoly is a precise form of market structure. A monopoly occurs when only one
person or enterprise is the only supplier of a particular good. Thus, monopolies are characterized
by no competition within the market producing a good or service.
Figure 1. The Four Types of Market Structure
SOURCE: https://thumbs.dreamstime.com/z/describing-four-types-market-structure-market-structure-
171015677.jpg

III. EXAMPLES:
Market
EXAMPLES
Structure
Perfect Examples: Bigasan store, Meat, and vegetable store. Their product price is
Competition in tock or fix. They don’t have the control to increase or decrease their
price because customers will find another vendor.
In this market structure, no participant can alter the prevailing price in the
market. If they attempt to do so, buyers and sellers have infinite
alternatives to pursue.
Monopolistic Restuarants like Inapuyan, Bistro Restaurant, Banchai, Lamutek, Mang

Competition Ipong, Mang Besang and others which all located in Candon City. The
difference is that each competitor is sufficiently differentiated offers from
the others that some can charge greater prices than a perfectly competitive
firm.
Another example of monopolistic competition is the music market. While

there are many artists, each artist is different and is not perfectly
substitutable with another artist.
Each firm makes independent decisions about price and output based on
its product, its market, and its costs of production.
Oligopoly
Examples for Mass Media are GMA 7, ABS-CBN 2, TV5, IBC 13, PTV
4, CNN Philippines RPN 9, etc. Oligopolists do not have the same pricing
power, it is possible, without diligent government regulation, that
oligopolists will collide with one another to set prices in the same way a
monopolist would.
Other examples are gasoline or petroleum. In the City of Candon, there is
gasoline company such as Petron, Centrum, Flying V, Phoenix, Shell, Sea
Oil, etc. They are few and they have their pricing power for their
products.
Monopoly A monopoly is a firm that is the sole seller of its product, and where there
are no close substitutes. An unregulated monopoly has market power and
can influence prices. Examples: Microsoft and Windows, DeBeers and
diamonds, your local natural gas company.

Figure 2: Monopoly examples
https://www.wallstreetmojo.com/monopoly-examples/
There is only one producer of a particular good or service, and generally no

reasonable substitute. In such a market system, the monopolist can charge
whatever price they wish due to the absence of competition.
IV. GENERALIZATION:
There are four types of market structure, Perfect Competition-many sellers of a
standardized product, Monopolistic Competition-many sellers of a differentiated product,
Oligopoly-few sellers of a standardized or a differentiated product, Monopoly-a single seller
of a product for which there is no close substitute.

V. EXERCISES:
Name: ________________________________ Grade & Section:____________________
Module #____________ Parent’s Signature: __________________
Activity1
Directions: Identify the types of market structure on the given market below. Write your
answer before each number.
________________1. Tobacco Industry

________________2. Broadcast Media
________________3. Coconut Industry
________________4. Automobile Industry
________________5. Cellphone Providers
________________6. Oil and Gas Industry
________________7. Agricultural Products
________________8. Online Shopping
________________9. Fast Food Company
________________10. Restaurants
Activity 2. Show Me How! (Performance Task #3)

Directions: Look for pictures that best describe each of the following market structures. You
may cut pictures from old magazines or download from the internet and print and paste them
on the spaces provided. You may also draw pictures on the spaces beside each market
structure instead of pasting pictures. After that, give your explanation. Make it as brief and
substantial as possible.
Use the following rubric as your guide.
Perfect
Competition

Monopolistic
Competition
Oligopoly
Monopoly
Rubric for scoring

10 8 6 4 Total
All the Pictures/ Only three of the Only two of the Only one or
drawings are pictures/ pictures/ none of the
related to the drawings are drawings are pictures/
market structure relevant to the relevant to the drawings is
market structure market structure relevant to the
market structure
Explains relevant Explains relevant Explains relevant Explains
concepts in all concepts in three concepts in two relevant concept
market structures market structures market structures in only one
market structure

VI. REFERENCES:
Lumbre, Angelina P, et.al., 21st Century MATHletes 2016 (Quezon City: Vibal Group,
Inc.), pp. 260-275.
thumbs.dreamstime.com “Market Structure” Accredited September 3, 2021,
https://thumbs.dreamstime.com/z/describing-four-types-market-structure-market-
structure-171015677.jpg>
wallstreetmojo “Monopoly Examples” Accredited September 4, 2021,
https://www.wallstreetmojo.com/monopoly-examples/>
Books Rosemary P. Dinio, PhD and George A. Villasis. Applied Economic First Edition.
Quezon City: Rex Book Store Inc., 2017.
Tereso S. Tullao Jr., PhD. Applied Economics for Progressive Philippines. Quezon City:
Phoenix Publishing House, Inc. 2018
Dinio, Rosemary P., PhD & Villasis, George A. (2017). Applied Economics. Sampaloc,
Manila: Rex Book Store, Inc. Websites
VII. ANSWER KEY:

8. Pure Competition
7. Pure competition
6. Oligopoly
5. Oligopoly
4. Oligopoly
3. Monopoly
2. Monopoly
1. Monopoly
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Republic of the Philippines

II. GUIDE QUESTIONS:

THE MARKET STRUCTURE IN ECONOMICS

THE FOUR TYPES OF MARKET STRUCTURE

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Figure 1. The Four Types of Market Structure

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Monopolistic Restuarants like Inapuyan, Bistro Restaurant, Banchai, Lamutek, Mang

Another example of monopolistic competition is the music market. While

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There is only one producer of a particular good or service, and generally no

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________________1. Tobacco Industry

Activity 2. Show Me How! (Performance Task #3)

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Rubric for scoring

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VII. ANSWER KEY:

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