2. Discuss the following statement: 'In the real world there is no industry which conforms precisely to the economist's model of perfect competition. This means that the model is of little practical value'.

2. Discuss the following statement: 'In the real world there is no industry which conforms precisely to the economist's model of perfect competition. This means that the model is of little practical value'.

Exploring Economics

8th Edition

ISBN:9781544336329

Author:Robert L. Sexton

Publisher:Robert L. Sexton

Chapter12: Firms In Perfectly Competitive Markets

Section: Chapter Questions

Problem 2P

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2. Discuss the following statement: 'In the real world there is no industry which
conforms precisely to the economist's model of perfect competition. This means that
the model is of little practical value'.

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1 Evaluate the demand curve of firms that operate in Perfect competition
Using examples, explain the down-sloping and upsloping long run ATC. Why may pure competition earn economic profits in the short run but not in the long run?
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