Question

In pure competition, producers compete exclusively on the basis of

a. selling identical items.
b. advertising heavily to promote their good.
c. producing the unique features of their good.
d. focusing on maintaining a positive image.

Answer 1

A. selling identical items.

Answer 2

a. selling identical items.

Step-by-step explanation:

A pure competition market is characterized by many firms selling a homogeneous product in a market with many buyers. There are no dominant suppliers; hence no single or group of sellers can influence the price. Pure competition is also the perfect competition.

The key characteristics of pure competition are

• There are many buyers and sellers
• All firms sell an identical product
• All sellers are price takers. None can influence prices
• There is intense competition due to the high number of sellers
• Ease of entry and exit from the market.