If markets were perfect, then labor and other costs of production would be easily transferable.

Question

Quizplus · Accepted Answer

In a perfectly competitive market, factors of production such as labor and capital are easily transferable between firms because there are no barriers to entry or exit. This means that if a worker or firm can produce a good or service at a lower cost than their competitors, they will be able to enter the market and gain market share, leading to lower prices for consumers.

If Markets Were Perfect, Then Labor and Other Costs of Production