Definition: A market is an institution or mechanism that brings buyers and sellers of particular goods, services, or resources together.

• Characteristics:
  • where all the buyers and sellers meet and trade
  • consist of large numbers of independently acting buyers and sellers of standardized products
  • Highly competitive
  • involve demand, supply, price, and quantity
  • two types:
    Product - Goods and Services
    Resource - Productive Resources
    
• Examples of markets:

• local markets
• Ex: Grocery store
• national or international
• Ex: Trade between states/countries
• personal (face to face)
• Ex: A farmer's roadside stand
• faceless (buyer and seller never meeting)
• Ex: eBay
• a purely competitive market
• Ex: There are so many independent buyers and sellers that they cannot control the market price.
• a purely noncompetitive market
• Ex: There is a monopoly on the product by a single firm so that they can set whatever market price they want.