Assignment Papers-Could there be external events that affect the perfectly competitive market?
For the particular firm/business you selected, describe the markets in which the firm participates that are close to perfectly competitive. Note that for most firms that students choose, the market for the firm’s output is not perfectly competitive—it more resembles monopolistic competition or oligopoly. However, it is very likely that some of the inputs to the firm’s production are close to perfectly competitive markets.
Do those markets completely satisfy the assumptions of perfectly competitive markets? Are there some assumptions that are just “mostly satisfied” or “nearly satisfied”, but close enough so that the ideas of Perfect Competition can still be applied? What are those differences, if any exist? How might those differences affect the conclusions of chapter 14?
Could there be external events that affect the perfectly competitive market? What changes might occur? (Think about what you learned in chapter 4.) How would those changes affect your chosen firm and what decisions would your firm change—would those changes be drastic or minor?
