A product market has many buyers and many sellers, and its largest company produces 1% of the market output. In addition, all sellers produce identical goods. What market structure is consistent with this description?
A)Perfect competition
B)Monopoly
C)Monopolistic competition
D)Oligopoly

Question

Quizplus · Accepted Answer

The fact that there are many buyers and many sellers producing identical goods with no differentiation implies that there is perfect competition. The largest company being responsible for only 1% of the market output further confirms the absence of market power and the perfect competition structure.

A Product Market Has Many Buyers and Many Sellers, and Its