Pure Competition Essays
Sellers are unable to decrease the price of a product because it is so readily available from competitors, and consumers are unable to decrease it because there is such wide demand.
Most agricultural markets are good examples of pure competition.
In pure competition, product prices are set by market demand, not by sellers.
Pure competition is an ideal economic scenario in which there are a large number of independent sellers and consumers, and the given product is in ready supply.
Try it risk-free Pure competition is a term that describes a market that has a broad range of competitors who are selling the same products. Here are some characteristics that define pure competition: To further illustrate pure competition, let's imagine that you are purchasing assorted color latex balloons.
You go to your local party store where you find several different brands of balloons available.
The Common Stock Market is another example; common stocks represent the lowest tier of ownership, and are widely available.
The Foreign Exchange Market, in which participants buy and sell foreign currencies, is also a good example.
Examples of pure competition include agricultural markets and the Common Stock Market.
Once the products are part of pure competition, the sellers of those products often have similar sales.
Because competition is much less intense in pure competition, new companies can easily enter the market and start selling products.
In many markets there may be brief periods of pure competition.
But, most often, a given market will shift as the number of sellers and buyers fluctuates, leading to changes in production, demand and prices.