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19 February, 05:05

How does perfect competition affect the equilibrium price?

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  1. 19 February, 05:30
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    Answer: The competition represents two opposing elements that compete with one another to reach a specific goal.

    Explanation:

    Competition is present in all segments of life, including economically and commercially. Trade competition in achieving the most favorable terms of exchange; takes place on the part of the bidders who try to secure sales with lower prices and better quality of their goods or services, on the side of the buyers who offer higher rates and other more favorable payment terms trying to reach the desired products and services, and between buyers and sellers.

    Therefore, the parties are forced to adapt to the general terms of supply and demand, thereby establishing a price that equates to the number of goods offered and claimed. Only in such conditions can the balance of rates and market equilibrium be pronounced. In such relationships, there is also a decrease in prices. To abolish the possibility of monopoly and thus regulate the raising of rates, states should give everyone the same conditions for market competitiveness.
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