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Perfect competition
firms organise inputs/factors of production in order to produce outputs which they can sell
Perfect competition includes
Many buyers and sellers
Homogeneous products
not possible to distinguish between products of different firms
Subnormal profits
When market demand is relatively low, presenting firms with a price lower than its ATC
Natural monopoly
When an industry in which one single firm produces all the output due to economies of scale as its average total cost is falling over a very large scale or output
Perfect resource mobility
all resources used for production can be moved from one firm to another at zero cost
Perfect information
all producers and consumers have access to all information regarding methods of production
Freedom of entry and exist
firms can enter and exit the market at any point
Abnormal / supernormal profit
When a firm in a perfectly competitive market is selling its output for price that is greater than its average total cost, then the firm earning is making a supernormal profit in the short run
Subnormal profits
When market demand is relatively low, presenting firms with a price lower than its ATC
Natural monopoly
When an industry in which one single firm produces all the output due to economies of scale as its average total cost is falling over a very large scale or output
A monopoly has the following characteristics:
Firms can make long run supernormal profits
Non availability of close substitutes of the good on the market
High level of inefficiency
Singular firm that supplies the product
Note 
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