Perfect competition is characterized by:
A)control of a common resource.
B)quality competition.
C)the inability of any one firm to influence price.
D)many firms selling a similar yet distinct product.

Question

Quizplus · Accepted Answer

In perfect competition, there are many firms selling a similar yet distinct product. However, none of them have enough market power to influence the price. This means that the price is "set" by the market instead of any one firm. Therefore, answer C is correct. Control of a common resource (A) is a characteristic of a common pool resource, not perfect competition. Quality competition (B) can exist in any market structure, including perfect competition.

Perfect Competition Is Characterized By