People in the eastern part of Beirut are prevented by border guards from traveling to the western part of Beirut to shop for food. This situation violates the perfect competition assumption of:
A) price-setting behavior.
B) a small number of buyers and sellers.
C) differentiated goods.
D) ease of entry and exit.

Question

Quizplus · Accepted Answer

The perfect competition assumption of ease of entry and exit is violated by border guards preventing people from traveling to the western part of Beirut to shop for food. This restriction makes it difficult for new sellers or buyers to enter or exit the market freely, resulting in an obstacle to achieving a perfectly competitive market.

People in the Eastern Part of Beirut Are Prevented by Border