Have you ever visited to any vegetable market? If yes, then you must have noticed that every vendor offers a particular vegetable in same price. It doesn’t vary according to vendor do you know why?It’s due to the nature of market here the barrier of entry is almost zero, there are many buyer as well as many sellers. There all similar vegetables in different vendor is same there are no product differentiation with respect to the vendors so no customer is interested in product differentiation here so all are concern about only price. They decide the vendor according to lowest price. So every vendor tries to keep the same price of a vegetable in the market.So here competition is very high and this type of market is called as perfect competition market .
No comments:
Post a Comment