ECONOMICS (CBSE/UGC NET)

Detailed explanation-1: -Perfect competition is a hypothetical market structure in which there are very many firms, each of which represents an infinitesimal share of the market. In a perfectly competitive market, if any firm is able to earn an economic profit, other firms will immediately enter the market, driving economic profit to zero.

Detailed explanation-2: -Pure or perfect competition is a market structure defined by a large number of small firms competing against each other. A single firm doesn’t have significant marketing power, and as a result, the industry produces an optimal level of output because firms don’t have the ability to influence market prices.

Detailed explanation-3: -As mentioned earlier, perfect competition is a theoretical construct and doesn’t actually exist. As such, it is difficult to find real-life examples of perfect competition but there are variants present in everyday society.

Detailed explanation-4: -Perfect Competition Explained Perfect competition is a theoretical market structure where direct competition does not exist between firms or sellers. Instead, many sellers (also buyers) are present in the market that simultaneously sell an identical product at the market price.

Detailed explanation-5: -Perfect competition, a theoretical market structure that features no barriers to entry, an unlimited number of producers and consumers, and a perfectly elastic demand curve.