Which of the following is characteristic of a perfectly competitive market?
A) There is free entry into and exit from the market.
B) Individual firms can exert a perceptible influence on the market price.
C) The firms in the market produce differentiated products.
D) All of the above are true.

Question

Quizplus · Accepted Answer

Free entry into and exit from the market is a characteristic of a perfectly competitive market. B is incorrect because individual firms cannot influence the market price in a perfectly competitive market as they are price takers. C is incorrect because firms in a perfectly competitive market produce homogenous products.

Which of the Following Is Characteristic of a Perfectly Competitive