Title
(1) Characteristics of Perfect Competition
Topic Category
Perfect Competition
Publication Date
2011
Keywords
Perfect Competition, Barriers to Entry, Total Revenue, Average Revenue, Marginal Revenue
Abstract
This identifes the characteristics of the market structure of Perfect Competition. It explains why these characterisics are important and explains that these have implications for the revenue functions and decision making of the firm. Total, Average and Marginal Revenue Functions are described and graphed. Finally, these revenue functions are combined with cost functions to examine profitability, using both the totals and the average/marginal approaches.
Recommended Citation
Crane, Steven E., "(1) Characteristics of Perfect Competition" (2011). Principles of Microeconomics. Paper 41.
http://epublications.marquette.edu/microecon_learning/41
Run Time
7:59
Primary Discipline
Microeconomics
Skills Delivered
Ability to identify and explain the standard characteristics of a Perfectly Competitive Firm. Ability to explain the consequences for the firm's revenue functions, and to graph these functions. Ability to combine revenue and cost functions in a single graph and do profit-volume analysis using both the totals and the average/marginal approaches.
Rigor Level
2000
Prerequisites
Overview of Market Structure and Short Run Cost Videos