Which of the following lists correctly identifies the four basic market structures in microeconomics?

• A. Perfect competition, monopolistic competition, oligopoly, monopoly
• B. Perfect competition, monopoly, duopoly, monopsony
• C. Monopoly, duopoly, monopsony, oligopoly
• D. Monopolistic competition, duopoly, oligopoly, monopsony

Answer: (A)

Verified step by step guidance

1. Understand that the four basic market structures in microeconomics are classifications based on the number of firms in the market, the type of products they sell, and the ease of entry and exit.
2. Recall the definitions of the four basic market structures: Perfect competition (many firms, identical products), Monopolistic competition (many firms, differentiated products), Oligopoly (few firms, may sell identical or differentiated products), and Monopoly (one firm, unique product).
3. Identify that terms like duopoly (a special case of oligopoly with exactly two firms) and monopsony (a market with a single buyer) are more specific or different market concepts, not part of the basic four structures.
4. Compare each list given in the problem to the standard four market structures and check which list contains exactly Perfect competition, Monopolistic competition, Oligopoly, and Monopoly.
5. Conclude that the correct list is the one that includes Perfect competition, Monopolistic competition, Oligopoly, and Monopoly, as these are the four basic market structures commonly studied in microeconomics.