Perfect Competition
Need to KnowAt the end of this section the student should be able to:
• Give examples of perfectly competitive markets • Outline the assumptions underlying perfect competition • Explain the term “price taker” and graphically illustrate same • Explain the shape of the D/AR/MR curve facing a firm in PC • Graph and describe the SR equilibrium of a firm in PC • Explain why new firms enter the market • Graph and describe the LR equilibrium of a firm in PC • Outline why PC benefits consumers and society • Outline why firms in PC do not engage in competitive advertising • Illustrate the concept of generic advertising • Graph and explain the SR and LR supply curves of a firm in PC |
ResourcesUseful LinksVideos |