In the theory of perfect competition, the assumptions of many buyers and sellers, the production of a homogeneous product, and the possession of all relevant information by buyers and sellers imply that the perfectly competitive firm

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In a perfectly competitive market, the presence of many buyers and sellers, the production of a homogeneous product, and the possession of all relevant information imply that no single firm can influence the market price. This results in a perfectly elastic demand curve for the firm, meaning it can sell any quantity at the market price but cannot influence the price itself.

In the Theory of Perfect Competition, the Assumptions of Many