Question

explain the price determination in the perfect competition under the following heads​

Answer 1

Answer:

Under perfect competition, many factors influence the determination of the price of goods. In this article, we will look at the equilibrium of the industry and the equilibrium of a firm as important factors behind price determination under perfect competition.

Explanation:

Equilibrium of the Industry under Perfect Competition

In economic terms, an industry consists of many independent firms. Each firm has a number of factories, farms or mines, as required. Each such firm in industry produces a homogeneous product. Equilibrium of the industry happens when the total output of the industry is equal to the total demand. In such a scenario, the prevailing price of a commodity is its equilibrium price.