A condition needed for perfectly competitive industry to exist is that ________.

buyers are able to influence the price of the commodity

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each unit of commodity is considered by buyers to be differentiated

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buyers discriminate in their purchases based on non-price factors

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there are no obstacles to the free mobility of resources

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Solution

The correct option is D there are no obstacles to the free mobility of resources
Perfect competition is a type of market where there are huge number of buyers and sellers who deals in the same type of product due to which no individual unit is able to influence the price of the product. There is free mobility of all the resources in a perfectly competititve market.

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Similar questions

Q. The situation in which buyers are able to affect the price of a good is referred to as ______ power.

Q. Assertion :Price reduction normally leads to an increase in the demand for a commodity Reason: Price reduction leads to the entry of new buyers of the commodity in the market

Q. Give reasons or explain:

1. Single price prevails in perfect competition.

2. Price discrimination is possible under monopoly.

3. Selling cost is incurred by a firm in Monopolistic competition.

4. A monopolist can control the supply of goods.

5. Sellers and the buyers are price takers in perfect competition.

Q. Fill in the blanks with appropriate alternatives given in the brackets:

1. Under perfect competition commodities are ________________ in nature. (homogeneous/ classified/ heterogeneous/ supplementary)

2. _____________ appears in a monopoly market. (product differentiation/ price discrimination/ individual differentiation/ packing differentiation)

3. The price at which demand and supply equate to each other is called _______ price. (general/ equilibrium/ short-run/ reserve)

4. In ________ market, seller creates products differentiation. (competition/ perfect/ pure/ monopolistic competition)

5. Monopolist means __________ competitive. (single seller/ several seller/ single buyer/ several buyer)

How are the equilibrium price and the equilibrium quantity of a normal commodity affected by an increase in the income of its buyers? Explain with the help of a diagram.

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