Question

which of the following are characteristics of a perfectly competitive market?please select two answer choices.select all that apply:firms produce similar, but not identical productsthere are many buyers and sellerssellers give vague information about products they are producingfirms can enter and exit the market with no restrictions

Answer 1

In a perfectly competitive market, there are many buyers and sellers, and firms can freely enter and exit the market without restrictions. These features ensure a market where identical products are sold by all firms, with complete transparency of information.

Step-by-step explanation:

The characteristics of a perfectly competitive market include several key elements that define its structure. Specifically, two such characteristics are:

• There are many buyers and sellers in the market.
• Firms can enter and exit the market with no restrictions, meaning there is free entry and exit.

These conditions create a market where firms produce identical products, and sellers provide clear and complete information about the products to the buyers, ensuring that all participants can make rational decisions. Contrary to one of the choices, sellers do not give vague information about their products in a perfectly competitive market. Instead, transparency and full information are hallmarks of this market structure.