Definition of perfect competition, Managerial Economics

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1. Prof. Marshall 'The more nearly perfect a market is, the stronger is the tendency for same price to be paid for same thing at the same time in all parts of the market".

2. Prof. Benham  "A market is said to be perfect when all potential sellers as well as buyers are promptly aware of the price at that transactions take place and all of the offers made by other buyers and sellers and when any buyer can purchase from any seller and vice-versa".

So perfect competition is a market situation where a colossal amount of buyers and sellers possessing complete knowledge of the market come together to afford the similar products. In perfect competition, an equilibrium price exists in market and firms are free to participate in and to exit the market.


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