Perfect competition is characterized by perfect information, no barriers to entry, and ________.
A) limited sellers
B) limited buyers
C) heterogeneous products
D) no monopolies

Question

Quizplus · Accepted Answer

Perfect competition is characterized by no monopolies, meaning there are many small firms in the industry, none of which have market power. The other options, limited sellers and heterogeneous products, are characteristics of imperfect competition, specifically monopolistic competition. Limited buyers does not factor into either type of competition.

Perfect Competition Is Characterized by Perfect Information, No Barriers to Entry