Question:
Which of the following is the best example of a perfectly competitive market?
Which of the following is the best example of a perfectly competitive market?
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Look for many sellers, an identical product, and no one able to set the price on their own.
Updated On: Jul 3, 2026
- Gold trade
- Chocolate market
- Soft drinks
- Farming
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The Correct Option is D
Solution and Explanation
Step 1: A perfectly competitive market needs a large number of small buyers and sellers, a homogeneous product, free entry and exit, and no single participant able to influence price.
Step 2: In farming, millions of small farmers grow largely identical crops like wheat or rice and each farmer is a price taker.
Step 3: Chocolate and soft drinks are branded, differentiated products controlled by a few large firms, so they are oligopolistic, not perfectly competitive.
Step 2: In farming, millions of small farmers grow largely identical crops like wheat or rice and each farmer is a price taker.
Step 3: Chocolate and soft drinks are branded, differentiated products controlled by a few large firms, so they are oligopolistic, not perfectly competitive.
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