1. Home
  2. Docs
  3. Economics for Business
  4. Market Structure and Pric...
  5. Perfect Competition

Perfect Competition

Perfect Competition is the market structure in which there are many buyers and many sellers of a homogenous product selling at a uniform price.

  • In this type of market, firms are price takers, meaning they accept the price determined by market forces of supply and demand.
  • Large Number of Buyers and Sellers:
    • There are so many buyers and sellers that no single entity can influence the market price.
  • Homogeneous Products:
    • All firms sell homogenous products.
  • Free Entry and Exit:
    • Firms can freely enter or leave the market without significant barriers.
  • Perfect Information:
    • All buyers and sellers have complete knowledge of the market, including product prices and availability.
  • Price Takers:
    • Firms have no control over the price of their products.
    • They must sell at the price determined by the overall market.
  • No Government Intervention:
    • There is no regulation or restriction by the government on the operations of buyers and sellers.

How can we help?

Leave a Reply

Your email address will not be published. Required fields are marked *