| A | B |
|---|
| Laissez-faire | philsophy that government shoudl not interfere with business activity |
| market structure | market classification according to number and size of firms, types of products, and type of competition |
| imperfect competition | market structure where all conditions of pure competition are not met |
| Monopolistic competition | market structure having all conditions of pure competition except for identical products |
| product differentiation | real or imagined differences between competiting products in the same industry |
| collusion | agreements among producers to fix prices. limit output, or divide markets |
| price-fixing | agreement by firms to charge a uniform price for a product |
| independent pricing | pricing policy by an imperfect competitor that ignores other products and some market conditions |
| Price leadership | independent pricing decisions made by a dominate firm on a regular basis that results in generally uniform industry-wide prices |
| price war | fierce price competition between sellers, sometimes to the point where price is below the cost of the product |
| monopoly | market structure characterized by a single producer |
| natural monopoly | market where average costs are lowest when all output is produced by a single firm |
| franchise | exlusive right to produce or sell a certain product in an area or region |
| economies of scale | increasing efficient use of personnel, plant, and equipment as a firm becomes larger |
| geographic monopoly | market situtation where a firm has a monopoly because of its location or the small size of the market |
| technological monopoly | market situation where a firm has a monopoly becuase it owns or controls a manufacturing method, process, or other scientific advance |
| government monopoly | monopoly created and/or owned by the government |
| market failure | market where any of he requirements for a competitive market are lacking |
| externality | economic side effect that affects an uninvolved third party |
| negative externalities | harmful side effect that affects a third party |
| positive externalities | beneficial side effect that affects an univolved thrid party |
| public goods | economic product that is comsumed collectively i.e. highways, national defense, police and fire protection |
| price discrimination | illegal practice of charging customers different prices for the same product |
| cease and desist order | ruling requiring a company to stop an unfair business practice that reduces or limits competition |
| public disclosure | requirement forcing a business to reveal information about its products or its operations to the public |
