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Price determination in perfect competition?
Price under perfect competition is determined by the forces of demand and supply of the industry. The price once fixed up by the industry is taken up by all the firms and the firm can sell any number of units at hat price.=The firm may earn normal profits, super normal profits in the short run whereas it earns normal profits in the long run.=
What is the condition to get maximum profit of a firm in perfect competition?
Mr=mc
Explain in detail Price determination under perfect competition?
Price under perfect competition is determined by the forces of demand and supply of the industry. The price once fixed up by the industry is taken up by all the firms and the firm can sell any number of units at hat price.=The firm may earn normal profits, super normal profits in the short run whereas it earns normal profits in the long run.=
Under perfect competition a firm can earn normal perfect in the long-run?
Perfect competition is efficient in the long run because price _____ marginal cost and firms are producing at minimum _____.
Distinguish between industry demand and firm demand?
Industry demand is subject to genera economic conditions. Firm demand is determined by economic conditions and competition
Who has the exercise about fundation year economics such as the theory of the perfect competition and economics of the firm?
die
Compare monopoly and monopolistic competition?
A monopoly is a market which has only one firm, the firm has market power, and there are barriers to entry. The long run profits for a monopolist may be greater than zero. Monopolistic competition is more closely related to perfect competition than monopoly. In monopolistic competition, there are many firms in the market. However, each firm has product differentiation. An example of monopolistic competition would be the jeans industry. There are many different types/quality of jeans e.g. True Religion, Levi's and Lee's. Products are somewhat differentiated, but, as in perfect competition, the long run profit = 0. Oligopoly is a market in which there are only a few firms, each firm has market power, and there is much product differentiation between the firms. The long-run profit of oligopoly can be greater than zero, because there are barriers to entry in the market.
A firm under a perfact competition is a price-taker not price-maker with examples?
it is a price taker because under perfect competition,price is determined by the market(through price mechanism:demand and supply) and not producer.this is because there are so many producers of the same product and all have the perfect knowledge of the market and there is only one buyer of that product,so no body can decide the price of the commodity on behalf of others.thats why a firm under perfect competition is a price taker and not a price maker. As part of the industry, the firm has to simply charge price determined by the industry. If the firm charges more price, it will lose sales and if it charges less price it will incur losses. The typical example of perfect competition is agriculture. The products are indistinguishable. There are many potential suppliers. This makes the farmer a price taker; if he or she prices the product higher than the market price, he or she will not make any sales or make fewer sales, thus incurring loss. Thus the farmer has to go with the price determined by the industry in order to survive
Is peanut industry perfect competition?
No. There is no perfectly competitive market in real life.
Which market situations in an industry results in the lowest prices for consumers?
perfect competition
Which of these market situations in an industry results in the lowest prices for consumers?
perfect competition
Why is the price elasticity of the demand curve of an individual firm in perfect competition is always infinite?
Under perfect competition, the industry is defied as a group of firms producing a homogeneous product. The technical characteristics of the product as well as the services associated with its sale and delivery are identical. Hence there is no way in which a buyer could differentiate among the products of different firms. If the product were differentiated the firm would have some discretion in setting its price. So the firm is a price taker and its demand curve is infinitely elastic.
