Question

What is pure competition?a. A theoretical market structure with very large numbers and identical products.b. A theoretical market structure with very large numbers, identical products and freedom of entry and exit.c. A theoretical market structure with very large numbers, identical products, freedom of entry and exit, and perfect knowledge by all buyers and sellers of market conditions.

Answer 1

Answer:

The correct answer is option b.

Explanation:

A pure competition is theoretical market structure with very large number of buyers and sellers, identical or homogenous products and freedom of entry and exit.

It is not applicable to the real world and is purely theoretical.

The perfect competition, on the other hand, is a similar market structure but it the consumers have perfect knowledge about the market.

Answer 2

Answer:

The answer is C

Explanation:

A theoretical market structure with very large numbers, identical products, freedom of entry and exit, and perfect knowledge by all buyers and selkers of narket conditions.