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Which of the following is not a characteristic of a perfectly competitive market? A Large number of firms in the industry B Outputs of the firms are perfect substitutes for one another C Firms face downward-sloping demand curves D Resources are very mobile

Which of the following is not a characteristic of a perfectly competitive market?

A

Large number of firms in the industry

B

Outputs of the firms are perfect substitutes for one another

C

Firms face downward-sloping demand curves

D

Resources are very mobile

 

Grade:11

1 Answers

Mayank Ranka
askIITians Faculty 281 Points
2 years ago

Option C is correct

As firms are price takers and have to sell all their output at a predetermined industry price, thus they face a flat demand curve parallel to the X axis, at the industry price.
 
Option A,B,D are incorrect
As they all state true and essential characteristics that are necessary to make an industry perfectly competitive.

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