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Explain “perfect knowledge about the markets” feature of perfect competition. |
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Answer» The feature ‘perfect knowledge about market’ means that firms as well as the buyers have the perfect knowledge about the cost and price of the product prevailing in the different parts of the market. As a result of perfect knowledge about the market, no seller can afford to charge a price higher than the prevailing price. If he tries to charge the price more than prevailing price, he will lose all his customers to his competitors. This will lead to emergence of uniform price of the product in the market. |
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