There are many distinct characteristics that classify a market as Perfectly Competitive including:

• Very large number of firms
• Homogenous products
• Entry and exit into the market free of barriers
• Perfect Information
• Individual firms are price takers
• Long run economic profits will be zero

Instructions

Given these characteristics of a perfectly competitive market, select one of the characteristics listed. In your post:

• Fully explain what that characteristic means and what its importance is to classifying a market as perfectly competitive.
  • If you have noticed this characteristic in a certain market, explain where you have seen it before or provide your own example.
• Would you see the characteristic you are discussing in any of the other three market structures - monopolistic competition, oligopoly or monopoly?
  • Why or why not?

Where appropriate, cite examples from your text or other readings.