Question

mperfect markets have higher prices than perfect markets. Please select the best answer from the choices provided T F

Answer 1

Imperfect markets have higher prices than perfect markets. If an individual seller tries to increase the price of their product in a perfectly competitive system then: the individual will not be able to sell any of their product. ... Barriers to entry can include technology, start-up costs and imperfect competition. So TRUE

Answer 2

TRUE

Step-by-step explanation:

In perfect markets, the logic of competition operates where many companies supply identical products and compete for price. Thus, if a company practices higher prices, consumers will buy from other companies, that is, in perfect competition the firms have no power to influence the price.

In imperfect competitive structures, companies have the power to influence prices, albeit relative. This is common in oligopolies (when few firms supply similar products) and especially in monopolies (when only one firm supplies the product). In these two types of structure, the price is higher because there is little competition.