The closest example of a perfectly competitive market isGroup of answer choicesfast foods.beer.gasoline stations.soybeans.
Question
The closest example of a perfectly competitive market is
Group of answer choices
- fast foods.
- beer.
- gasoline stations.
- soybeans.
Solution
The closest example of a perfectly competitive market is soybeans.
Here's why:
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Many sellers and buyers: In a perfectly competitive market, there should be many sellers and buyers. The soybean market has a large number of sellers (farmers) and buyers (consumers, companies, and countries).
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Homogeneous product: In a perfectly competitive market, the products are identical. Soybeans are a homogeneous product because one soybean is not significantly different from another.
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Free entry and exit: In a perfectly competitive market, firms can freely enter and exit the market. In the soybean market, farmers can decide to plant soybeans or not, depending on the market conditions.
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Perfect information: In a perfectly competitive market, all buyers and sellers have complete information about the product and the market. In the soybean market, information about prices and quality is widely available.
Therefore, among the given options, the soybean market is the closest example of a perfectly competitive market.
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