ECONOMICS
MARKET FAILURES
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Question
[CLICK ON ANY CHOICE TO KNOW THE RIGHT ANSWER]
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lots of non price competition
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products are very similar so there must be product differentiation
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identical products
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very competitive
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Detailed explanation-1: -The correct answer is (c) Free entry is limited.
Detailed explanation-2: -A perfectly competitive market is an ideal market where there are many well-informed buyers and sellers, no barriers to market entry and no possibility of a monopoly. Profit, diminishing supply, rivalry and exclusion are among the 10 characteristics of a competitive market.
Detailed explanation-3: -Answer and Explanation: Markets do not need a central physical location. In fact, many markets today do not have physical locations.
Detailed explanation-4: -In a perfectly competitive market: all firms sell an identical product; all firms are price-takers; all firms have a relatively small market share; buyers know the nature of the product being sold and the prices charged by each firm; the industry is characterized by freedom of entry and exit.
Detailed explanation-5: -Perfect Competition. Features of Perfectly Competitive Market. 1) A large number of buyers and sellers. 2) Homogenous products. 3) Free exit and entry of firms. 4) Perfect knowledge among buyers and sellers. 5) No transport costs. 6) Perfect mobility of factors of production. More items