The behavior expected in a competitive market includes

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In a competitive market, firms are expected to engage in marginal cost pricing, ensuring that prices reflect the actual cost of production. This helps to maintain a level playing field for all competitors, and allows consumers to benefit from lower prices. Additionally, in a competitive market, businesses should expect a relatively high level of entry and exit, as new firms enter the market to take advantage of opportunities, and less efficient firms exit due to intense competition. While some level of aggressive behavior among competitors is also common, it is not considered a necessary or desirable feature of a competitive market.

The Behavior Expected in a Competitive Market Includes