Economics Basics Perfect competition
Introduction
What Is Economics
Scarcity
Macro and Microeconomics
Production Possibility Frontier (PPF)
Opportunity Cost
Specialization and Comparative Advantage
Absolute Advantage
Demand and Supply
The Law of Demand
The Law of Supply
Time and Supply
Supply and Demand Relationship
Equilibrium
Disequilibrium
F. Shifts vs. Movement
Elasticity
The availability of substitutes
Income available to spend on the good
Time
Income Elasticity of Demand
Utility
Monopolies
Oligopolies
Perfect Competition

Conclusion

 

 

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There are two extreme forms of market structure: monopoly and, its

opposite, perfect competition. Perfect competition is characterized by many buyers and sellers, many products that are similar in nature and, as a

result, many substitutes. Perfect competition means there are few, if any, barriers

to entry for new companies, and prices are determined by supply and demand. Thus, producers in a perfectly competitive market are subject to the prices determined by the market and do not have any leverage. For example, in a perfectly competitive market, should a single firm decide to increase its selling

price of a good, the consumers can just turn to the nearest competitor for a better price, causing any firm that increases its prices to lose market share and profits.

 

 

 

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