Evaluate the perfect competition market structure as a benchmark against which the functioning of all other types of market structures can be compared in terms of allocative efficiency and productive efficiency. Kindly provide a very detailed answer.
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Productive efficiency is achieved at minimum average cost, while
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- Evaluate the perfect competition market structure as a benchmark against which the functioning of all other types of market structures can be compared in terms of allocative efficiency and productive efficiency. Please provide diagrams with this answer.Comparison between Pure competition and the perfect competition in market structure of the economy?Why is the perfect competition often used as a benchmark? Question 3 options: The perfect competition model is more frequently observed in the real world compared to other market models It provides a useful comparison to markets that operate in more complex, real-world conditions. It accounts for a variety of issues like pollution, inventions of new technology, poverty, and government programs that other models do not account for. In the real world, all markets are perfectly competitive, so this model allows us to compare them to one another.
- Q3 : Elaborate the Perfect Competition Model in detail.why do economists and policy makers use perfect competition as a benchmark to analyze market structure and performance?Describe the main differences between each of the four market structures we've studied in class. Be sure to comment on how the characteristics of the market/industry structures affect economic efficiency as well as firms' ability to earn economic profit in the long run.
- How is the PROCESS (steps) of adjustment or transition from short to long term equilibrium in perfect competition? To solve this, you must base yourself on the GRAPHIC model, starting from what happens in the market equilibrium as more companies join, more competition, and like this, it influences the entrepreneur's decisions until reaching the long-term mathematical equilibrium / equality.Which of the following products/markets is most consistent with the perfect competition model? Apple iPhones a bustling farmers' market Kellogg's Frosted Flakes electric utilities automobiles 2 Adam Smith’s “invisible hand” refers to The mechanism that moves market price and quantity to equilibrium The natural tendency of markets to avoid monopolies and ensure competition The market’s incentive to lower price in order to increase quantity sold The lack of government role in the free market due to the market’s ability to self-regulate The tendency of firm’s to seek to merge in order to realize synergies and market dominance 3 A company facing inelastic demand for a product sees an increase in its costs after a worker strike forces a wage increase. What is likely to happen to the price and quantity sold of that product? Price will fall slightly while…Discuss the economic conditions that are necessary to achieve productive and allocative efficiency under pure competition?
- There are various market kinds in the market structure where each type of market has its own characteristics. Explain all types of markets along with their respective characteristics. Support your explanation with the help of suitable examples for each sub division of market accordingly.If all assumptions of perfect competition hold, why would firms in such an industry have little incentive to carry out technological change or much research and development?Describe how firms in Perfect Competition achieve both allocative and productive efficiency and their significance in relation to the other market models. Why is the portion of the marginal cost curve above the minimum average variable cost the short run supply curve in Perfect Competition?