What are the four assumptions of the perfectly competitive model? Critics are fond of pointing out that few, if any, real- world markets satisfy all four conditions, implying that the competitive model has little relevance for real- world markets. How would you respond to these critics?
Answer to relevant QuestionsHow can consumers of apartments in Atlanta have a downward-sloping demand curve for apartments, and yet each Atlanta rental property owner face a horizontal demand curve?How would each of the following phenomena affect the long-run supply curve of apples? a. Workers in the apple industry form a union. b. Consumers find out that apples cause cancer. c. Hard-to-control bugs that eat apples ...“In a competitive industry‚ high prices in response to a positive demand shock prevent higher prices.” Explain whether this statement is true‚ false or uncertain in the context of the competitive industry model ...Using Figure, show the effect on consumer and producer surplus of the sugar import quota (relative to free trade). Also show the changes in consumer and producer surplus in RoW.When a ski resort with some monopoly power is maximizing profit, price is greater than marginal cost. Thus, consumers are willing to pay more for additional lift tickets than the tickets cost to produce. So why does the ski ...
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