Question

Describe an existing competitive or almost competitive market. Be creative, upload a picture of the product.
Elaborate on all four of the characteristics of competitive markets that define your particular market, and use them to defend that you have actually chosen a competitive market.
Confirm that the firm is a price taker and why.
Eg: Eggs, Wheat, Generic bottled water/soda/chips, Milk, some stuff on the Internets.

Answer 1

Most of the agricultural commodities reflect the trait of a perfectly competitive market such as corn. Corn bushels are sold at marginal cost, thereby earning minor or zero profit.
Other traits of corn markets are:
1) A large number of farmers are producing corn, thereby everyone is a small player and none can mold the market as per their needs. Hence Sellers are the price takers.
2) There are a large number of consumers as a result consumer lacks bargaining power. Hence every consumer is also a price taker in the economy.
3) The corn produced is almost homogeneous ignoring the local variation such as Minnesota corn or Dakota variety of corn.
4) There are free entry and exit in the market because of which the firms are free to come or go depending upon the level of profitability prevailing in the market.
All the above observations indicate that the firm is a price taker rather than a price maker.

le OBLIOTECTE STEREO GIOISTENIE 486 SSSSS S