Under which of the following market structures would the highest output of a particular good be produced?

Question

Quizplus · Accepted Answer

In perfect competition, there are numerous small firms competing with each other in the market. No single market participant has significant market power, and thus, the behavior of a single firm cannot affect the market price or quantity of the good. Hence, in perfect competition, the market output is determined by the intersection of market demand and supply curves at the market-determined price level. Therefore, the highest output of a particular good would be produced under perfect competition, as there will be no incentive for any individual firm to restrict the output and lose its market share.

Under Which of the Following Market Structures Would the Highest