![]() It turns out that the efficiency of a market can have a lot to do with the number of firms and consumers in that market. Perfect competition is a market structure in which there is a large number of firms and consumers. ![]() Interested? Then read on! Perfect Competition Definition Here, you will learn everything there is to know about perfect competition. Although it may not exist in the real world, perfect competition serves as an important benchmark for assessing whether resources are allocated efficiently in real market structures in the economy. How would you feel living in a world where all products are homogeneous? This would also be the world where neither you as a consumer nor the firm as a seller, has the ability to influence the market price! This is what a perfectly competitive market structure is all about. Price Determination in a Competitive Market.Market Equilibrium Consumer and Producer Surplus.Determinants of Price Elasticity of Demand.Cross Price Elasticity of Demand Formula.Effects of Taxes and Subsidies on Market Structures.Monopolistic Competition in the Short Run.Monopolistic Competition in the Long Run.Behavioural Economics and Public Policy.
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