ECONOMICS
COMPETITION AND MARKET STRUCTURES
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Question
[CLICK ON ANY CHOICE TO KNOW THE RIGHT ANSWER]
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The products are identical.
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Buyers know a lot about the product.
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The sellers control the market price.
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Sellers can enter and exit the market easily.
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There are many buyers and sellers.
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Detailed explanation-1: -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.
Detailed explanation-2: -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-3: -a marketing situation in which there are a large number of sellers of a product which cannot be differentiated and, thus, no one firm has a significant influence on price. Other prevailing conditions are ease of entry of new firms into the market and perfect market information.
Detailed explanation-4: -Perfect competition: There are many buyers and sellers in the market, and there is no fixed buying and selling relationship between them. 2. The products or services traded in the market are all the same without any difference.
Detailed explanation-5: -A large number of buyers and sellers. Homogenous products. Free exit and entry of firms. Perfect knowledge among buyers and sellers. No transport costs. Perfect mobility of factors of production. No promotional and selling costs.