which is an example of an almost perfectly competitive market? A.NBA B.ailines C.restaurants D.cruise liners E.famers'...

which is an example of an almost perfectly competitive market?

A.NBA

B.ailines

C.restaurants

D.cruise liners

E.famers' market with many sellers

Expert Solution

Answer: Option E. Famers' market with many sellers.

This option fulfils most of the criteria for being a perfectly competitive market.

Following are the criteria to be a perfectly competitive market:

There are many sellers in the market with almost same types of products or commodities.
All sellers are price taker. The price is not set by any one of the seller or buyers.
No influence of market share on prices.
Buyers mostly have all the information about the product or commodity or "perfect" information—in the past, present and future.
Resources for such a labor are perfectly mobile.
Firms can enter or exit the market anytime and without cost.

Other options do not fulfil few criteria, like Restaurants, all service providers do not set the price of their services collectively. For airlines also, The entry criteria is tough, and has a huge cost.

For NBA- resources can not be sent to any other game.

And similarly, for cruise liners, the prices are set by individual providers and it has a tough entry criteria. Other criteria also do not fulfil.

Rahul Sunny answered 2 years ago

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