A market is a mechanism or an arrangement in which the buyers and the sellers are involved. The buyers and the sellers of a commodity or service come into contact with one another and complete the act of sale and/or purchase on mutual agreements by the exchange of money. The two forms of market are Perfect competition and Imperfect Competition. A perfectly competitive market is that type or form of market where there are a large number of buyers and sellers who are selling and buying identical products at a uniform price. An imperfect competition refers to a situation where the characteristics of an economic market do not fulfil all the necessary conditions of a perfectly competitive market, resulting in market failure. Determination of Prices means to determine the cost of goods sold and services rendered in the free market. Moreover, market structure can range from perfect competition to a pure monopoly. There is free entry and exit of firms and the absence of government control. In a perfectly competitive market structure, the price always remains at the equilibrium level. The market demand and the market supply decide the market price at a point where they intersect each other at a point.

Payal Jain

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