A. A monopolistically competitive market exists when a substantially large 
          number of firms serve a  market with relatively differentiated products.
     B. Examples are merchandising  selling  shoes, shirts, TV's, groceries, etc.
     C. Product differentiation
          1.For some it is real, important, for others it's artificial, unimportant.
             a. Non-price competition differentiators
                 1. Product quality
                  2. Product image (Branding)
                  3. Customer service
                  4. Store environment and image
              b. Condition for sale (location)
                  1. Mail order
                  2. Home delivery using the internet
                  3. Bidding on the internet
     C. Some control over price exists and demand tends to be more elastic 
          than with monopoly or oligopoly markets.
     D. Economic analysis of monopolistic competition
         1. P is high compared to pure competition (P> MR = MC)
         2. Quantity will be restricted causing ATC to be higher than that 
              indicated by the curve's lowest point.
         3. Tends to be more competitive than monopoly and oligopoly.
         4. Some believe economic profit tends toward zero as the number
             of firms adjust to varying profit levels.
 VI. An oligopoly market exists when barriers to entry result in a 
        few mutually dependent
        companies controlling a substantial portion of a market. 
        A. Products may be homogeneous or differentiated.
        B. Examples include many industrial products such as steel
             and large consumer durables such as appliances. 
        C. Automobile, steel, game consoles and other oligopolistic industries lost
             monopoly power because of the foreign invasion of the 1970's.
        D. Economic analysis of oligopoly 
              1. Restrictive oligopolies tend to be very monopolistic in nature with
                  a.  P > MR = MC
                  b.  Production is not at the lowest point indicated by the ATC curve.
                  c.  Economic profits exist and quantity is restricted.
              2. Progressive oligopolies have high economic profits in spite  
                  of price decreases brought on by high-tech efficiencies.