Chapter 9, Problem 21AA

To determine

To state: Whether the competition is good for consumers.

Answer to Problem 21AA

Competition is good for consumers as it offers them with unlimited choices.

Explanation of Solution

More competition is generally good for consumers because more competition means more firms in the selling business resulting in more choices for the consumers to choose from. In competition it is basically price, quality, quantity differentiating the product by which consumers get many choices to find the best possible product to their demand.

More competition leads to decrease in supply because sellers don’t get the chance to have a good market share as the market gets divided amongst other sellers too.

Economics Concept Introduction

Introduction: Competition is considered good for consumers are offered a wide variety of products to choose from and thus the sellers ensure that good quality products are being offered to them.