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Concepts of Market

Market can be defined as a place or an arrangement where goods and services are bought and sold. The market is a point of contact where buyers and sellers transact business with one another at a price determined by the market forces.

Classification of Market

There are different classifications of market:

(i) Classification of market on the basis of commodities sold in them e.g. capital market, factor market, commodities market, labour market, money market etc. 

(ii) Classification of market on the basis of their relative competition or price e.g. perfect and imperfect market.

Types of Markets According to Commodities Sold/Purchased

(1) Labour Market: It is a market that brings workers and employers into close contact for the purpose of rendering services.

(2) Factor Market: It is the market for selling and buying of factors of production such as labour, land, capital, and entrepreneur.

(3) Money Market: Money market is the market for short term loans.

(4) Capital Market: Capital market is the market where we obtain medium and long-term loans.

(5) Consumer Market: It is the market for buying and selling different forms of commodities such as maize, rice, cosmetics, shoe, cocoa, electronics, computers, etc.

Types of Market According to Relative Competition or Price

1. Perfect market/competition 

2. Imperfect market


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