Question

Identical products, as well as a large number of buyers and sellers, are characteristics of a market. In such markets, sellers of goods influence the prevailing market price, giving them the role of price in the market. True or False: The market for wheat does not exhibit the two primary characteristics that define perfectly competitive markets.

Answer 1

Answer: False

Explanation:

Indistinguishable items, just as countless purchasers and merchants, are attributes of a perfectly competitive market. In such market, venders of products don't impact the prevailing market price, giving them the role of price takers in the market.

In a perfectly competitive firm, there are numerous purchasers and venders. In addition, all merchants sell an indistinguishable goods. Also, since every merchant dominates a little segment of the market, dealers can't impact the cost. Along these lines, sellers are price takers.

There are large number of sellers and buyers in the wheat market. Also, they are selling similar type of wheat.