Question 18 of 36
Q.Point out the essential features of Perfect Competition.
Puducherry TnboardTamil Nadu HSC First Year (DGE) Commerce Board 2022Subjective· 2mImportance★★★★★
50% · 18/36 Questions
You're viewing a preview — the full solution, concept, methods & PYQ mapping are locked.
Start your 14-day free trial to unlock the full solution →Perfect competition is a market with many buyers and sellers dealing in an identical product, with free entry/exit, perfect knowledge and mobility, so that a single price prevails and every firm is a price-taker.
The essential features are:
- Large number of buyers and sellers — no single firm or buyer can influence the price; each is too small.
- Homogeneous product — all firms sell an identical product, so buyers have no preference between sellers.
- Free entry and exit — firms can enter or leave the industry freely in the long run.
- Perfect knowledge — buyers and sellers have full information about prices and the market.
- Perfect mobility of factors of production — factors move freely to their best use.
- Absence of transport costs — ensures a single price everywhere. …
Unlock everything free for 14 days
- Full step-by-step solutions
- Concept-first explanations
- Methods, shortcuts & mistakes
- PYQ mapping + timed mock tests
Full access for 14 days. No credit card required.