ECONOMICS (CBSE/UGC NET)

Detailed explanation-1: -Under perfect competition, there are many buyers and sellers, and prices reflect supply and demand. Companies earn just enough profit to stay in business and no more. If they were to earn excess profits, other companies would enter the market and drive profits down.

Detailed explanation-2: -A perfectly competitive market is dominated by the presence of large number of buyers and sellers of a commodity, which means that there is no such buyer or seller in the market whose purchase or sale is so large as to impact the total sale or purchase in the market.

Detailed explanation-3: -Perfect competition is a type of market structure where all companies or firms are selling the same product, and because of having no control over their product prices, they tend to be price takers. In this market, consumers have full or perfect knowledge about the product that is on sale.

Detailed explanation-4: -Perfect competition is a market in which:-There is generally a large number of buyers and sellers.-Buyers and sellers sell identical products (there is no need for advertising).

Detailed explanation-5: -Perfect competition is a market situation where there are a large number of buyers and sellers and selling of identical products takes place. The commodity is sold at a uniform price in the market.