# Questions tagged [perfect-competition]

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### Why is the competitive equilibrium price not well defined in this question?

Consider a market demand function p = 100 − q, where p is market price and q is aggregate demand. There is a large number of firms with identical cost functions ...
22 views

### Competitive input markets and allocative efficiency

Suppose two firms are operating in a competitive input and output markets. If the two firms' production functions are $(k_1l_1)^{1/3}$ and $(1+k_1)^{-1} (l_2)^{1/2}$ where $k_1, l_1, l_2$ denote the ...
199 views

### Book reference for graphs explaining ad valorem and specific taxes

Does anyone know any book in which I can read and see graphs about the ad valorem or specific tax in monopolies or perfect competition? I need a graph like this with the explanation but i can't find ...
44 views

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### How is it possible to have perfect balance of supply and demand?

How is it possible to have perfect balance of supply and demand? That is, e.g. the right amount of workforce compared to the amount of work. Background (as asked by Giskard in the comments): It's ...
17 views

### How does Perfectly Competitive Output Level Compare to Cournot Output Level

So Let there be two firms with Output Level x1 and x2 .Inverse Demand Function $P=a-bX$ where $X=x1+x2$.Both firms have same MC denoted by $c$. Is the Perfectly Competitive O/t > Cournot O/t ...
57 views

### Aren’t all firms price-takers?

So I hear this distinction between price-taking firms and price-making firms in regards to perfect competition. Price-taking firms are firms that accept the price determined by supply and demand. But ...
1 vote
108 views

### Why can't an individual producer influence market price in perfect competition?

I’ve been told that under perfect competition, an individual producer is a price-taker and has no influence on the market equilibrium price. But this doesn’t make sense to me since the market ...
134 views

### How does perfect competition work?

I have made several other posts about this topic, but all the answers I got confused me even more. This is my attempt at making a comprehensive post that highlights my confusion about perfect ...
257 views

### How can an individual firm sell ANY quantity for the market price under perfect competition?

I keep hearing that under perfect competition, an individual firm can sell ANY quantity as long as they sell at the equilibrium price. But this doesn’t make sense to me. For the market supply and ...
308 views

### How is it possible for demand to be perfectly elastic under perfect competition?

So according to perfect competition, a single firm is a price taker, having to sell at the equilibrium price as determined by supply and demand. As you can see from the single firm graph, demand is ...
48 views

### Industry supply and short-run cost function

If we know that the long-run number of firms in a competitive market is $50$, the total short-run cost (associated with the long-run equilibrium output) is $C_s(q) = 0.5q^2 - 10q + 200$, can we say ...
995 views