What assumptions about the economy must hold

Reference no: EM133394122

Case: The model of perfect competition in the market for consumer goods predicts that the adoption of the contract law standard of unconscionability may result in businesses being compelled to sell their goods for less than their usual market value, leading to shortages (i.e. quantity demanded exceeds quantity supplied).

Question 1: What assumptions about the economy must hold for the perfect competition model of the market for consumer goods to be a valid depiction of reality

Question 2: Please list at least one real-world example of a market for a consumer good that does not exhibit the assumptions necessary for perfect competition. Do you think that contractual exchange of money for goods in this market ought to be covered by the standard of unconscionability? Why or why not?

Reference no: EM133394122

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