Answer to Question #157083 in Economics for kieraa

Question

1. Provide an example of perfect competition from either “King Corn” or “Food, Inc.”
2. Explain how this example fits the definition of perfect competition. 

Answer 1

Improving production, reducing production costs, automating all processes, optimizing the structure of enterprises - all this is an important condition for the development of modern business. What's the best way to get businesses to do all this? Market only. The market refers to the competition that arises between enterprises that produce or sell similar goods. If there is a high level of healthy competition, then in order to exist in such a market, it is necessary to constantly improve the quality of the goods and reduce the level of overall costs. Perfect competition, examples of which are given in the article, is the complete opposite of a monopoly. That is, it is a market in which an unlimited number of sellers operate, who deal with the same or similar goods and at the same time cannot influence its price. At the same time, the state should not influence the market or engage in its complete regulation, since this can affect the number of sellers, as well as the volume of products on the market, which is immediately reflected in the price per unit of goods.