Which of the following is not an essential condition of pure competition?

Large number of buyers and sellers

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Homogeneous product

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Freedom of entry

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Absence of transport cost

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Solution

The correct option is B Absence of transport cost
Option D is correct
As transport costs may or may not exist in perfectly competitive market structure. It is up to the individual firms and their supply chain policies, it is not necessary for transport costs to be absent for the firm to be operating in a perfectly competitive market structure.

Option A,B,C are incorrect
As they all state true and essential characteristics that are necessary to make an industry perfectly competitive.

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