Michael Weiss is a columnist for Foreign Policy, The Daily Beast, and NOW Lebanon. He is also a fellow at the Institute of Modern Russia where he is the editor-in-chief of The Interpreter, an online news and translation journal covering Russian foreign policy and the ongoing war in Ukraine.
Perfectly competitive firms are small in size in relation to the market size â and none of these firms control the market. A monopolist firm, on the other hand, is larger and controls the entire market for its industry. Monopolistic firms are price makers by virtue of their market control.
(7) The last difference between the two market situations is that the output of the firm under monopolistic competition is smaller and price higher than under perfect competition. This is illustrated in Figure 14 where D/AR. The LMC and LAC curves are assumed to be the same for both the firms.