Respuesta :
If a profit-maximizing firm in a competitive market discovers that, at its current level of production, price is greater than marginal cost, it should increase its output.
What is competitive market?
In response to customer demand for products and services, a competitive market develops. Due to the competition created by this market system, businesses must assess their costs of production, pricing policies, and product output.
Some key points of the competitive market are-
- Perfect competition, as well as competitive markets, aim to factor in both the buyer and the supplier equally and develop strategies based on the market's current supply and demand.
- We define competitive marketplaces, describe their traits, and explain their functions and distinctions in this article.
- No single consumer or producer can control the market in an environment where there is competition.
- A market that is totally competitive has many knowledgeable buyers and sellers, no obstacles to entrance, and no potential for monopolies.
- Among the ten characteristics of a competitive market are profit, diminishing supply, competition, and exclusion.
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