Question 11 of 36
Q.Perfect competition assumes ______.
(a) Homogenous goods
(b) Luxury goods
(c) Producer goods
(d) Differentiated goods
Puducherry TnboardTamil Nadu HSC First Year (DGE) Commerce Board 2020MCQ· 1mImportance★★★★★
31% · 11/36 Questions
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Start your 14-day free trial to unlock the full solution →Perfect competition assumes (a) homogeneous goods.
Perfect competition is a market with a very large number of buyers and sellers where firms have no control over price. A key assumption is that all firms produce a homogeneous (identical) product, so the goods of one seller are perfect substitutes for those of another. Because buyers cannot distinguish between sellers' products, a single uniform price prevails throughout the market and each firm is a price-taker.
Why the others are wrong:
- (d) Differentiated goods are a feature of monopolistic competition, not perfect competition. …
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