Perfect competition

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A market is said to be one with perfect competition if:

  1. There is a large number of small producers and consumers on a given market
  2. None of the parties can influence the price on his own
  3. The price is given
  4. Goods and services are perfect substitutes - they are homogeneous
  5. All resources (including information) are perfectly mobile
  6. Transaction costs are naught.

Other market forms