Micro Economics Flash Cards

Question	Answer
Paradox of Value	-The Value of Use refers to the usefulness of a commodity whereas the Value of Exchange refers to the rate of exchange of a commodity as compared to the other.
Monopolistic Competition	* It is a realistic market situation. It is a combination of Monopoly and Competition. It has fairly a large number of sellers and buyers. The products sold by the sellers and similar, but not identical. They are close substitutes. There is product differentiation. the products are slightly differentiated. the products are neither homogeneous nor remote substitutes. The sellers can follow their own price output policy because of product differentiation. But, they have limited monopoly power.
Perfect Competition.	It is the ideal market structure. It has a large number of buyers and sellers. The products sold by them are similar or homogeneous. Each product is the perfect substitute for each other. There is no product differentiation as all the products are similar or identical. *The price of the commodity is determined by the market demand and market supply. an individual buyer or seller cannot influence the market price.

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	Created by nish.peekaboo almost 11 years ago