Question

Why do we study Perfect Competition? When it does not exist in real

life situation?​

Answer 1

Answer:

Key Takeaways. Neoclassical economists claim that perfect competition–a theoretical market structure–would produce the best possible economic outcomes for both consumers and society. All real markets exist outside of the perfect competition model because it is an abstract, theoretical model.

Answer 2

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ɴᴇᴏᴄʟᴀssɪᴄᴀʟ ᴇᴄᴏɴᴏᴍɪsᴛs ᴄʟᴀɪᴍ ᴛʜᴀᴛ ᴘᴇʀғᴇᴄᴛ ᴄᴏᴍᴘᴇᴛɪᴛɪᴏɴ–ᴀ ᴛʜᴇᴏʀᴇᴛɪᴄᴀʟ ᴍᴀʀᴋᴇᴛ sᴛʀᴜᴄᴛᴜʀᴇ–ᴡᴏᴜʟᴅ ᴘʀᴏᴅᴜᴄᴇ ᴛʜᴇ ʙᴇsᴛ ᴘᴏssɪʙʟᴇ ᴇᴄᴏɴᴏᴍɪᴄ ᴏᴜᴛᴄᴏᴍᴇs ғᴏʀ ʙᴏᴛʜ ᴄᴏɴsᴜᴍᴇʀs ᴀɴᴅ sᴏᴄɪᴇᴛʏ.

ᴀʟʟ ʀᴇᴀʟ ᴍᴀʀᴋᴇᴛsᴇxɪsᴛ ᴏᴜᴛsɪᴅᴇ ᴏғ ᴛʜᴇ ᴘᴇʀғᴇᴄᴛ ᴄᴏᴍᴘᴇᴛɪᴛɪᴏɴᴍᴏᴅᴇʟ ʙᴇᴄᴀᴜsᴇ ɪᴛ ɪs ᴀɴ ᴀʙsᴛʀᴀᴄᴛ, ᴛʜᴇᴏʀᴇᴛɪᴄᴀʟ ᴍᴏᴅᴇʟ.