ECONOMICS
COMPETITION AND MARKET STRUCTURES
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Question
[CLICK ON ANY CHOICE TO KNOW THE RIGHT ANSWER]
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selling
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stocks
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price
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production
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Detailed explanation-1: -The most fundamental is perfect competition, in which there are large numbers of identical suppliers and demanders of the same product, buyer and sellers can find one another at no cost, and no barriers prevent new suppliers from entering the market. In perfect competition, no one has the ability to affect prices.
Detailed explanation-2: -A large population of both buyers and sellers ensures that supply and demand remain constant in this market. As such, buyers can easily substitute products made by one firm for another.
Detailed explanation-3: -Because there are many buyers and sellers in a perfectly competitive market, no one seller can influence the market price. Firms operating in perfectly competitive markets try to maximize profits. When an individual firm in a competitive market increases its production, it is likely that the market price will fall.
Detailed explanation-4: -Perfect competition occurs when there are many sellers, there is easy entry and exiting of firms, products are identical from one seller to another, and sellers are price takers.