The primary application of the model of perfect competition is to predict how firms will respond to changes in demand and production costs.

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The model of perfect competition provides a framework to analyze how firms will behave in response to changes in market conditions such as demand and production costs. It assumes that firms in a perfectly competitive market are price takers and must accept the market price for their product. As a result, firms will adjust their output levels to achieve maximum profit in response to changes in demand and production costs. Therefore, the primary application of the model of perfect competition is to predict how firms will respond to changes in market conditions.

The Primary Application of the Model of Perfect Competition Is