Security markets are considered to be perfect when firms can issue securities at no cost and the investor incurs no brokerage commissions.

Name: Security markets are considered to be perfect when firms can issue securities at no cost and the investor incurs no brokerage commissions.
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In perfect security markets, it is assumed that there are no transaction costs, including the costs for issuing securities and brokerage commissions, allowing for frictionless trading and investment.

Security Markets Are Considered to Be Perfect When Firms Can