Question

charectaris of perfect competition.​

Answer 1

Answer:

Following are the characteristics of perfect competition :

1. Large number of buyers.

2. Large number of sellers.

3. All sellers sell homogeneous product.

4. In perfect competition, seller is a price taker.

5. Prices are decided by market forces of demand and supply.

6. In perfect competition, sellers and buyers have small proportion in market. They cannot affect the demand and prices in market.

Answer 2

In Microeconomics,perfect competition is a particular type of market structure characterized by many buyers and seller,uniformed price for all goods and services and intense market competition among the sellers or the firms/companies.

Explanation:

Characteristics of Perfect Competition:-

• Perfectly competitive markets are commonly characterized by large number of buyers and sellers or many buyers and sellers of any particular good or service.
• The goods or services sold in the perfectly competitive markets are homogeneous or similar in nature,appearance,qualitative features etc.
• The price of goods and services sold in perfectly competitive markets is fixed or uniform,meaning that due to high competition all the sellers are compelled to charge the same price for their goods or services.
• There are no barriers of entry or exit for the sellers under perfect competition.Any firm or company can freely enter or exist the market according to their economic or financial circumstances.
• The consumers and sellers both have perfect knowledge about the market under perfect competition.
• Seller under perfect competition can enjoy full mobility of the factors of production.
• There are usually no transportation cost in perfect competition thereby enabling price uniformity in the market.