Question

There are a large number of small firms that provide entertainment for children's birthday parties. There is little difference between one company's inflatable slide and another company's. Clowns and magicians do similar tricks. Both the sellers and the parents buying the entertainment are well informed as to price and sources although sometimes it is difficult to hire the same entertainer two years in a row because the business is so easy to open and close. What type of market structure do local party entertainers depict?

Answer 1

The correct answer is: Perfect Competition.

Step-by-step explanation:

Perfect Competition is a theoretical market structure in which competition is at its greatest possible level. In a perfectly competitive market all firms sell an identical product and all those firms are price takers. Those companies have relatively small market share. Buyers have complete information about the product and its prices. Finally, there are low to no barriers to enter and exit an industry.