(a) Freedom of entry and exit of firms under perfect competition – The feature ‘freedom of entry and exit of firms’ means that firms are free to enter or leave the market at any time they like. If the firms are earning abnormal profits in short run, new firms will be attracted to the industry. This will shift the market supply curve to the right which will reduce the price as well as profit. If the firms are making abnormal losses in the short run, some of the existing firms will leave the market. This will shift the market supply curve to the left which will abolish the loss by increasing the price. Thus, in the long run, all firms under perfect competition will earn only normal profits. 

(b) Non-price competition under oligopoly – In case of oligopoly, firms do not face price competition because prices of the products are more or less rigid. Once a price has been fixed, a firm will avoid changing it. Hence, price rigidity is an essential feature of oligopoly. However, there is non-price competition among firms to attract customers. 

Non-price competition is visible in following forms : 

1. Product research and development 

2. Stronger and more durable products 

3. Better packaging 

4. Easier credit terms 

5. After sales service 

6. Advertising 

7. Personal selling.