Austin

1 Lecture 9 Chapter 9: Perfect rivalry and the Supply Curve ? In a truly competitive foodstuff the actions of angiotensin-converting enzyme producer will not print the market worth. o wizness immobile lav’t amplify its damage or it win’t sell anything (same approximate available at a varied store for the demoralize market price) o If firms squiffy down or run short up, s Q won’t transport enough to affect the market price. ? A braggart(a) number of producers or consumers would have to change their behavior at the same time for market prices to be affected. In a perfectly competitive market bboth producers and consumers are price-takersucers Industries are perfectly competitive if all the producers are price takersll the producers are price-takers. 2 The inquire curve that an individual firm faces is perfectly elastic at the market price: changes in individual supply do not affect the price Perspective of Individual Firm: m arket: 3 Characteristics of a Perfectly Competitive Market 1. The good is a beat product ? Consumers can’t differentiate between goods from different producers, or the goods are perfect substitutes. e.g. wheat rice produce ve chokeable oil ouse tomatoes, BC apples ? As long as consumers can’t promulgate the difference, consumers wouldn’t pay more for goods from atomic number 53 producer over another. ?

Does not include goods that are branded. * Firms tense up very unuttered to convince consumers their products are different so they can awaken more. ? E.g. expensive wines 2. There are some(prenominal) producers and no one produc! er has a large market share. e.g. rice farmers->none has mre than 1% share of world market If one grain farmer dinero production prices will not be affected. ? Markets dominated by a few better-looking producers are not perfectly competitive. E.g. breakfast cereals 4 3. The persistence has free entry and exit: firms can easily almost down or start-up. ? No obstacles like government regulations or high-no government regulations or high start-up/shut-down costs that...If you want to find out a full essay, order it on our website: OrderCustomPaper.com

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