Which of these are characteristics of Perfect competition.a)Many Sellers & Buyersb)Homogeneous Productc)Free Entry and Exitd)All of the aboveCorrect answer is option 'D'. Can you explain this answer?

Question

Answer

The answer is D: All of the above. Perfect competition is an idealized market structure that serves as a benchmark for analyzing other market structures. It is characterized by the following features:Many Sellers & Buyers:- A large number of both sellers and buyers participate in the market- No single seller or buyer can influence the market price- Each participant is a price taker, meaning they have no control over the market priceHomogeneous Product:- The products offered by all sellers in the market are identical or very similar- Buyers have no preference between different sellers' products- This ensures that price is the only factor that influences buyers' decisionsFree Entry and Exit:- There are no barriers to entering or exiting the market- Firms can easily enter the market if they believe they can earn a profit- Similarly, firms can exit the market if they are not making a profit- This feature ensures that resources are allocated efficiently and that profits are driven down to a normal level in the long runIn summary, perfect competition is characterized by many sellers and buyers, a homogeneous product, and free entry and exit. These features lead to a highly competitive market environment where firms are forced to operate efficiently and provide goods at a price determined by the market.

Answer

B)Homogeneous Products c)Low Barriers to Entry d)Price Takers e)Perfect Information f)No Non-Price Competition g)No Externalities h)Mobility of Resources i)Free Entry and Exit j)No Market Power

Answer

Yes d is correct option because perfect competition is those competition where similar product is sold and there are large number of buyer and seller is present in market to ready to buy and sell product. product is homogeneous . price is determined by the force of market d3mand and market supply. here  the exit and entry of firm is depend upon the short and long run period.

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