Perfect Competition
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In economic theory, perfect competition describes markets such that no participants are large enough to have the market power to set the price of a homogeneous product. Because the conditions for perfect competition are strict, there are few if any perfectly competitive markets. Still, buyers and sellers in some auction-type markets, say for commodities or some financial assets, may approximate the concept. Perfect competition serves as a benchmark against which to measure real-life and imperfectly competitive markets.
Read more about Perfect Competition: Basic Structural Characteristics, Approaches and Conditions, Results, The Shutdown Point, Short-run Supply Curve, Examples, Criticisms, Equilibrium in Perfect Competition
Famous quotes containing the words perfect and/or competition:
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—Jane O’Reilly, U.S. feminist and humorist. The Girl I Left Behind, ch. 7 (1980)
“Like many businessmen of genius he learned that free competition was wasteful, monopoly efficient. And so he simply set about achieving that efficient monopoly.”
—Mario Puzo (b. 1920)