Does the phenomenon violate the model of pure competition

Reference no: EM13234684

In NYC cab drivers have to acquire licenses to become cab drivers. They are pretty costly and protect the drivers that are already present in the industry. Still, there are zillions of cab drivers in NYC and they tend to be very picky in terms of their choice of passengers. If they can afford to ignore customers from time to time they might be making excessive profits. Let's assume that they make excessive profits (that's actually a fact). Does this phenomenon violate the model of pure competition? Why or why not?

Reference no: EM13234684

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