Perfect Competition and Monopoly, Cyclical Unemployment, Various Forms of Exchange Rate Regime

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1 Perfect Competition and Monopoly
A perfect competition and monopoly give a representation of two extremes within the continuum of a market structure. As depicted in Table 1:1 below, in one extreme is perfect competition that represents an ultimate efficiency achieved within an industry that is bounded by extreme competition within no market controls. On the other extreme as depicted in the Table is Monopoly that gives a clear representation of inefficiency that is inhibited by a market that lacks competition and an extensive structure that controls the market.
Table 1:1 Perfect Competition and Monopoly
It is essential to determine the fact that a monopoly is a representation of a market structure that lacks a proper market control. As the only seller within a market, a monopolistic company has the capacity to control the supply-side of the market. In contrast to this, a perfect competition defines a market structure in which organizations have no market control and are wholly dependent on the competitive nature of an industry. In this case no organization in perfect competition has the capacity to influence a markets price.
On the other hand, it is essential to establish that a perfect competitive market has no barrier of exit or entry while the monopolistic markets tend to have a few barriers to exit and entry. However, it is important to consider that the two markets tend to have some similarities in terms of elasticity of demands and an organizations capacity to achieve profits.
2a. Inflation & Unemployment
There are three primary types of unemployment. These include:
Cyclical Unemployment
It is essential to note that the cyclic unemployment is dictated by the ups and downs of the economy. In this case, it is essential to determine that cyclical unemployment occurs as a result of the cycles in the economy since many during economic recessions, many employees are bound to lose their jobs. An instance of this can be depicted in the Great depression that saw close to 25% of job cuts.
Frictional Unemployment:
This kind of unemployment occurs as a result of the normal turnover within the labor market and the duration this takes for the unemployed population to get new jobs. It is essential to note that employees are bound to change jobs within a year, a factor that makes it challenging to match up efficient employees with new employers.
Structural Unemployment
This occurs as a result of the absence of demand for certain types of employees, a factor that results in a mismatch between the skilled employees and the skills the employers require. Advances in technology and low labor costs are a...