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Perfect Competition:: Problem Statement

Perfect competition is a market structure where multiple small firms sell identical products, are price takers rather than price makers, and can easily enter and exit the industry. Key characteristics of perfect competition include a large number of buyers and sellers, perfect knowledge of products, free entry and exit to the market, homogeneous goods, no transportation costs, and profit-maximizing firms. The document then lists objectives to research whether perfect competition exists in Pakistan's markets and to analyze its characteristics.

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Maliha Rehman
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40 views1 page

Perfect Competition:: Problem Statement

Perfect competition is a market structure where multiple small firms sell identical products, are price takers rather than price makers, and can easily enter and exit the industry. Key characteristics of perfect competition include a large number of buyers and sellers, perfect knowledge of products, free entry and exit to the market, homogeneous goods, no transportation costs, and profit-maximizing firms. The document then lists objectives to research whether perfect competition exists in Pakistan's markets and to analyze its characteristics.

Uploaded by

Maliha Rehman
Copyright
© © All Rights Reserved
We take content rights seriously. If you suspect this is your content, claim it here.
Available Formats
Download as DOCX, PDF, TXT or read online on Scribd

INTRODUCTION:

PERFECT COMPETITION:
Perfect competition is a market share in which all firms sell an identical
product, all firms are price takers , they cannot control the market price of
their products, firms have a relatively small market share.

CHARACTERISTICS OF PERFECT COMPETITION:


1) There are large numbers of buyers and sellers in the market.
2) Perfect knowledge of the product is another characteristic which says
all the buyers and sellers have complete knowledge about the
products.
3) Free entry and exit: firms are free to move in and out from the industry
without any kind of barriers.
4) The products are homogenous: all the firms in the market.
5) There are no costs associated with transportation.
6) Selling firms are profit maximizing entrepreneurial firms.
7)

Problem Statement:
Does perfect competition exist? Give a evidence from Pakistan.
Objectives of Research:

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identify
establish
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