What is Perfect Competition?
In a perfectly competitive market, marginal cost = price (MC = P). All suppliers in this market are price takers. The highest efficiency in perfect competition is "static", ie on a technical level.
Perfect competition
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- Chinese name
- Perfect competition
- Foreign name
- Perfect Competition
- Perfect competition conditions
- Long-term balance
- Types of
- market
- In a perfectly competitive market, marginal cost = price (MC = P). All suppliers in this market are price takers. The highest efficiency in perfect competition is "static", ie on a technical level.
- Perfect Competition
- Perfect competition conditions
- Number 1: There are a large number of suppliers on the market. No one supplier can influence the market No. 2: products are consistent, all suppliers provide the same products. No. 3: Perfect information, all suppliers know the price setting of other companies. No. 4: The same right to use, all suppliers have the right to use all product technology No. 5: Free entry and departure, all suppliers can enter and leave the market freely
- Long-term balance
- In the long run, the number of companies in the perfect competition market is limited. If a company A makes a profit in this market, when a new competitor enters the market, company A can no longer make a profit, so there are some The company will choose to leave this market. In a perfect market in long-term equilibrium, the ratio of profits is the same. The time to enter and leave the company is the same.