Economic Systems, Market Structures, and Porter's Five Forces

Vocabulary flashcards covering key terms related to economic systems (Market, Command, Mixed), market structures (Perfect Competition, Oligopoly, Monopoly), and competitive forces from Porter's Five Forces model.

Market Economy

An economic system where businesses and individuals make most decisions, prices are determined by supply and demand, and government intervention is limited.

Command Economy

An economic system where the government controls most resources, makes most decisions, and directs resources towards national priorities like housing, healthcare, and infrastructure.

Mixed Economy

An economic system combining elements from both free market and command economies, where businesses operate for profit but the government intervenes with taxation, regulations, and public services.

Perfect Competition

A market structure characterized by many sellers, low entry barriers, homogeneous products, and firms that act as price takers.

Oligopoly

A market structure dominated by a few dominant firms with high entry barriers, some price power, product differentiation, and interdependent firms.

Monopoly

A market structure featuring one single supplier with very high entry barriers, strong price power, and prices that are often restricted by government regulation.

Competitive Rivalry

A force within Porter's model that measures how strongly existing businesses in an industry compete with each other on price, quality, location, design, and customer experience.

Threat of New Entrants

A force within Porter's model evaluating how easy it is for a new competitor to enter the market, depending on capital requirements, premises, equipment, scale, and established brands.

Buyer Power

A force within Porter's model describing how much influence consumers have over prices and quality based on available alternatives and switching costs.