Log in lorne.prupas 7 years agoPosted 7 years ago. Direct link to lorne.prupas's post “What is the answer to the...” What is the answer to the question: Can you name five examples of perfectly competitive markets? Why or why not. My understanding is that there is no such thing as a perfectly competitive market. We may get close to one, such as in the airline industry. But it is still not a perfectly competitive market. Therefore, we can't give five examples. Or, is the question asking for a "nearly" perfectly competitive market. What is being asked for here and am is my understanding correct? • (11 votes) Temistocles Valdes 7 years agoPosted 7 years ago. Direct link to Temistocles Valdes's post “I think mining cryptocurr...” I think mining cryptocurrency meets the criteria listed above in that: Many firms (miners) produce identical products (cryptocurrency). arguably this isn't the case for every cryptocurrency but it seems like the concept fits nicely. (13 votes) crystal 7 years agoPosted 7 years ago. Direct link to crystal's post “A single firm in a perfec...” A single firm in a perfectly competitive market is relatively small compared to the rest of the market. What does this mean? How small is small? In this question how can I explain the how small ? • (2 votes) Mateusz Jamrog 7 years agoPosted 7 years ago. Direct link to Mateusz Jamrog's post “A small firm is a firm no...” A small firm is a firm not big enought to make any change in the equilibrium price. (12 votes) nidhipipalia30 6 years agoPosted 6 years ago. Direct link to nidhipipalia30's post “Suppose, in a perfectly c...” Suppose, in a perfectly competitive market selling oranges, a seller sells at 4$ per kilo and another seller sells at 5.5$ per kilo. Now, a buyer who comes across these two sellers may think that the 5.5$ oranges are better in quality even though they're the same and may purchase the latter. By going through the fourth paragraph of the 'Perfect competition and why it matters', how can we relate to it and won't other factors like consumer psychology have a say in this? • (3 votes) melanie 6 years agoPosted 6 years ago. Direct link to melanie's post “If the quality of the goo...” If the quality of the good is different based on the supplier (or even if people think that is the case), then it is by definition not a perfectly competitive market. Perfect competition requires completely identical goods. The situation you describe would be a monopolistically competitive market where goods are slightly differentiated. (8 votes) asmita mundhe 6 years agoPosted 6 years ago. Direct link to asmita mundhe's post “explain how a perfectly c...” explain how a perfectly competitive firm can make economic (abnormal)profit only in the short run? • (1 vote) melanie 5 years agoPosted 5 years ago. Direct link to melanie's post “In the long run, other fi...” In the long run, other firms will enter the market seeking to make the same economic profit. This drives the price down until no firms have any incentive to enter because there are no economic profits. (4 votes) Kamogelo Sedibe 7 years agoPosted 7 years ago. Direct link to Kamogelo Sedibe's post “Is a private school perfe...” Is a private school perfectly competitive or monopoly? • (2 votes) Harsimran Singh Sekhon 7 years agoPosted 7 years ago. Direct link to Harsimran Singh Sekhon's post “Neither. A perfectly comp...” Neither. A perfectly competitive market would have no differentiation or their goods or services, which may be accurate if you were talking about a public school, and its definitely not a monopoly as there is not just one brand of private schooling, but more than one. To be honest, based on the detailed characteristics, I'd label it under a monopolistic competition(MC) or an oligopoly. If it were to be under an MC, the main criteria would be similar but differentiated goods or services, and privates schools differ from one another based on their name (their brand). However, in a not-so urban region where private schooling is not common, it may fall under an oligopoly, as it would be one of very few other organisations that provite private schooling services, possibly allowing it a decent amount of market power to be a price maker. (2 votes) Subham Das 7 years agoPosted 7 years ago. Direct link to Subham Das's post “Does manufacturing of cel...” Does manufacturing of cellphones come under perfect competition?? • (1 vote) Andrew M 7 years agoPosted 7 years ago. Direct link to Andrew M's post “There's no such thing as ...” There's no such thing as completely perfect competition in real life. You need to examine the industry and ask yourself what are the characteristics of perfectly competitive markets and how closely does the cellphone industry match those. (3 votes) Liam Mullany 6 years agoPosted 6 years ago. Direct link to Liam Mullany's post “Is it fair to say that in...” Is it fair to say that in a perfectly competitive market, the supply is very inelastic? Because even a slight price increase from one firm will lead to them losing all their business to the other firms. • (1 vote) melanie 6 years agoPosted 6 years ago. Direct link to melanie's post “No, it is actually the op...” No, it is actually the opposite: a firm's supply curve is perfectly elastic. Even a slight change in price loses ALL business. Perfectly inelastic would mean a change in price results in NO business lost. (2 votes) aspljai11 7 years agoPosted 7 years ago. Direct link to aspljai11's post “what is the meaning of 'm...” what is the meaning of 'market structure' here ? • (1 vote) NP 7 years agoPosted 7 years ago. Direct link to NP's post “Market structure defines ...” Market structure defines the various characteristics of a selected market or industry. (2 votes) Vivian 2 years agoPosted 2 years ago. Direct link to Vivian's post “How does a perfectly comp...” How does a perfectly competitive market appear mainly in products? • (1 vote) jon.bronson2890 4 years agoPosted 4 years ago. Direct link to jon.bronson2890's post “Does an inelastic demand ...” Does an inelastic demand curve cause farm prices to fluctuate more in response to supply changes than if the demand were elastic? • (1 vote)Want to join the conversation?
Many buyers are available to buy the product (cryptocurrency), and many sellers are available to sell the product (cryptocurrency).
Sellers and buyers have all relevant information to make rational decisions about the product (cryptocurrency) being bought and sold.
Firms (miners) can enter and leave the market without any restrictions—in other words, there is free entry and exit into and out of the market.
and i also didn't got the meaning of sentence 'the market structure is the conditions in an industry,' . please explain that.
FAQs
What is perfect competition your answer? ›
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.
What is the answer to the perfect competition model? ›A perfectly competitive market is the far end on the competitive spectrum where a number of assumptions are made. These assumptions are; perfect information, low barriers to entry and exit, many suppliers and many consumers, hom*ogeneous products, price taking behaviour and profit maximising strategy.
Why does perfect competition matter? ›In the short run, the perfectly competitive firm will seek the quantity of output where profits are highest or, if profits are not possible, where losses are lowest. In the long run, positive economic profits will attract competition as other firms enter the market. Economic losses will cause firms to exit the market.
What is the perfect competition model in microeconomics? ›Perfect competition is a model of the market based on the assumption that a large number of firms produce identical goods consumed by a large number of buyers. The model of perfect competition also assumes that it is easy for new firms to enter the market and for existing ones to leave.
What is perfect competition important? ›Perfect competition is a unique form of the marketplace that allows multiple companies to sell the same product or service. Many consumers are looking to purchase those products. None of these firms can set a price for the product or service they are selling without losing business to other competitors.
What are the main features of perfect competition answer? ›- A Large Number of Sellers and Buyers. ...
- Anti-Competitive Regulation. ...
- Every Participant is a Price Taker. ...
- hom*ogeneous Products. ...
- Rational Buyers. ...
- No Barriers to Entry or Exit. ...
- No Externalities. ...
- Non-Increasing Returns to Scale and no Network Effects.
The three primary characteristics of perfect competition are (1) no company holds a substantial market share, (2) the industry output is standardized, and (3) there is freedom of entry and exit. The efficient market equilibrium in a perfect competition is where marginal revenue equals marginal cost.
What are the 4 assumptions of perfect competition? ›The four basic assumptions of perfect competition are: 1) large number of buyers and sellers, 2) hom*ogeneous products, 3) perfect information, and 4) free entry and exit.
Is perfect competition the most efficient? ›Perfect competition is both allocatively efficient, because price equals marginal cost, and productive efficient, because firms produce at the lowest point on the average cost curve. It is also x-efficient because competition between firms will act as an incentive to increase efficiency.
Does perfect competition really exist why or why not? ›Neoclassical economists claim that perfect competition would produce the best possible economic outcomes for both consumers and society. However, perfect competition doesn't exist in the real world. It is impossible for any real market to meet its criteria.
Who benefits more from perfect competition? ›
In a perfectly competitive market, consumers tend to have the most benefits because there is perfect knowledge. As a result, all participants obtain knowledge evenly; hence there is no information breakdown. Furthermore, no monopolies are formed from perfect competition since the entry into the market is easy.
What is the summary of perfect competition? ›Perfect competition means that there are many sellers, there is easy entry and exiting of firms, products are identical from one seller to another, and sellers are price takers.
What are the advantages and disadvantages of perfect competition? ›Consumers benefit more from perfect competition due to increased choices and lower prices. What is the failure of perfect competition? Perfect competition can fail to provide economies of scale, leading to higher production costs.
What is perfect competition for dummies? ›Perfect competition: Perfect competition happens when numerous small firms compete against each other. Firms in a competitive industry produce the socially optimal output level at the minimum possible cost per unit. Monopoly: A monopoly is a firm that has no competitors in its industry.
What is perfect competition quizlet? ›Perfect competition is a market structure in which a large number of firms all produce the same product. commodity. A product that is the same no matter who produces it, such as petroleum, notebook paper, or milk.
What is perfect competition meaning for kids? ›Perfect competition is a hypothetical market situation in which competition is at its highest possible level and no individual buyer or seller can influence the market price of products.
What is the definition of perfect competition in an essay? ›Perfect competition: in this competition, no participant dominates the market thus; no specific seller has the power to set the prices of hom*ogeneous goods. This therefore makes the conditions of a perfect competitive market stricter than the rest of the market structures.
Is McDonald's a perfect competition? ›Monopolistic Competition
Examples include fast food restaurants like McDonald's and Burger King. Although they are in direct competition, they offer similar products that cannot be substituted—think Big Mac vs. Whopper.