Market for a necessary good is competitive in which the existing firms are earning super-normal profits. How can the policy of liberalisation by the government help in making themarket more competitive in the interests of the consumers. Explain.

Market for a necessary good is competitive in which the existing firms

1.	Market for a necessary good is competitive in which the existing firms are earning super-normal profits. How can the policy of liberalisation by the government help in making themarket more competitive in the interests of the consumers. Explain.
Answer» Solution :The policy of libralisation ENCOURAGES NEW firms to enter the industry. This RAISES output of the industry. Total market demand remaining unchanged, price starts falling. Consumers now GET the good at a cheaper price.