Monopoly - one seller price maker - unique product - impossible to enter market price discrimination MR = Marginal Revenue MC = Marginal

Cost ATC = Average Total Cost QMax = Quantity where MR = MC

Oligopoly - Few Big Sellers (<10) non-price competition - Homogenous / Differentiate - Difficult to enter Market Leader - largest market share Market Follower - Market Leader Lowers Price - Market Followers do the same - Market Leader Raises Price - Market Followers Price remains the Same Interdependent Elastic above optimal price Inelastic below Cartel Cartel colludes to raise price by lowering supply Income Effect As wages rise workers work less (above w2) Substitution Effect As wages rise workers work more (below w2) Demand for Labor Derived Demand Increase in Demand for goods and services Increase in Supply for goods and services Increase in Demand for Labor Demand for labor is a product of the demand for goods and services MPL = Marginal Product of Labor MRPL = Marginal Revenue Product of Labor (MP x P)

Game Theory Dominant Strategy In game theory, strategic dominance (commonly called simply dominance) occurs when one strategy is better than another strategy for one player, no matter how that player's opponents may play. Many simple games can be solved using dominance. The opposite, intransitivity, occurs in games where one strategy may be better or worse than another strategy for one player, depending on how the player's opponents may play. Nash Equilibrium In game theory, Nash equilibrium (named after John Forbes Nash, who proposed it) is a solution concept of a game involving two or more players, in which each player is assumed to know the equilibrium strategies of the other players, and no player has anything to gain by changing only his own strategy unilaterally[1]:14. If each player has chosen a strategy and no player can benefit by changing his or her strategy while the other players keep theirs unchanged, then the current set of strategy choices and the corresponding payoffs constitute a Nash equilibrium. The practical and general implication is that when players also act in the interests of the group, then they are better off than if they acted in their individual interests alone. Tit-fo-tat Tit for tat is an English saying meaning "equivalent retaliation". It is also a highly effective strategy in game theory for the iterated prisoner's dilemma. It was first introduced by Anatol Rapoport in Robert Axelrod's two tournaments, held around 1980. An agent using this strategy will initially cooperate, then respond in kind to an opponent's previous action. If the opponent previously was cooperative, the agent is cooperative. If not, the agent is not. This is similar to superrationality and reciprocal altruism in biology.

Fair price regulation Price = ATC break even Monopolistic - Many Sellers - Differentiate products - easy to enter/exit market Max Profit = MR = MC New entry to market makes demand curve shift down Downward slope of demand curve because of product differentiation not likely earn an economic profit in long run shutdown if price is less than avg variable cost

Non-price competition - Quality - Service - Packaging - Social Status