Explanation

 Distinction between a perfect market and a monopolistic market are:

(i) A perfect market is characterized by many buyers and sellers while in a monopoly market, there is only one or single producer or supplier of a particular commodity and many buyers.

(ii) In a perfect market, price and quantity are determined by the interaction of the Pri forces of demand and supply whereas in a monopoly market, price and quantity are determined by the producer, i.e., the producer has the power to influence either price or output in his favour.

(iii) There is free entry as well as exit in a perfect market while entry and exit are restricted in the monopoly.

(iv) Monopolists are able to discriminate due to different elasticities of demand for their products in different markets whereas this is absent in a perfect market because there is perfect elasticity of demand.

(v) There is homogeneity of products in a perfect market while in a monopolistic market this is not so.

(vi) There is under utilization of resources under monopoly and duplication of resources under perfect competition.

(vii) In a perfect competition there is perfect knowledge of the market situation whereas it is not true of monopoly.

(viii) The equilibrium level in a perfect competition is where MC = MR = P whereas in a monopoly, price is higher than MC and MR. 
 

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