Perfect competition and ita features

A perfect competition is the market situation where there are a large number of sellers competing to sell a homogenous product at a price fixed by the market. In such a case, a uniform price prevails in the market. This is decided by the industry itself (market forces of demand and supply).
Features of Perfect Competition

An essential aspect of perfect competition is the absence of any monopolistic element. These are the three essential features of perfect competition:

1. The number of buyers and sellers in the market is very large. These buyers and sellers compete among themselves. Due to the large number, no buyer or seller influences the demand or supply in the market.
2. The commodity sold or bought is homogeneous. In other words, goods produced by different firms are identical in nature.
3. Firms can enter or exit the market freely.