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Discussion Post: Competition in Perfect Markets
The market structure of perfect competition has a lot of ideal qualities-hence the name perfect. For example, perfectly competitive firms are productively efficient, and perfectly competitive markets are allocatively efficient. It is, however, difficult to find many examples of perfectly competition in the real world. Perfect competition is really a benchmark against which we compare other market structures in the real world.
1) How much actual competition occurs in perfectly competitive markets?
2) Some make the claim that there is actually no competition between firms in a perfectly competitive market. Do you agree or disagree with this claim?
3) What is your reasoning?
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