Chapter 47 Flashcards
1
Q
What is perfect competition?
A
A market structure where there are many buyers and sellers, where there is freedom of entry and exit to the market, where there is perfect knowledge and where all firms produce a homogenous product.
2
Q
What is a price taker?
A
A firm which has no control over the market price and has to accept the market price if it wants to sell its product.
