Final answer:
A perfectly competitive market features free entry and exit for firms, homogeneity of products, firms being price takers, and a large number of buyers and sellers. Producers in this market cannot set prices and do not offer differentiated products.B and F both is correct answer.
Step-by-step explanation:
In a perfectly competitive market, several key characteristics are present:
- Entry and exit for firms is possible without significant barriers. This means firms can freely join and leave the market, also known as free entry and exit.
- Producers are considered price takers, not price makers. The market sets the price, and individual firms have no control over it.
- A standardized product is offered by all firms within the market, which is also known as a homogeneous or identical product.
- There is a large number of buyers and sellers, which prevents any single one from influencing the price.
To answer the student's question, the characteristics of a perfectly competitive market from the options given that correctly apply are:
- Entry and exit for firms (A)
- A standardized product (C)
- Producers who are price takers (D)
- A large number of buyers and sellers (E)
Options B and F, which suggest that producers are price makers and the existence of a differentiated product, do not apply to a perfectly competitive market.