ECONOMICS (CBSE/UGC NET)

Detailed explanation-1: -In economic theory, perfect competition occurs when all companies sell identical products, market share does not influence price, companies are able to enter or exit without barriers, buyers have perfect or full information, and companies cannot determine prices.

Detailed explanation-2: -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-3: -Pure Competition Supply and demand determine the amount of goods and services produced, along with the market prices set by the companies in the market. Products are identical to competitors’ products, and there are no significant barriers to entering and exiting the market.

Detailed explanation-4: -Oligopoly = A market structure characterized by barriers to entry and a few firms. Oligopoly is a fascinating market structure due to interaction and interdependency between oligopolistic firms.