Question

Jerry has a wheat farm in nebraska. He sells his wheat to a buyer who stores it in his grain elevator along with grain from many of the other farms in the area. Jerry checked with other buyers and discovered that the amount paid per bushel of wheat was consistent throughout the region. What kind of market is he competing in?

Answer 1

Answer: Perfect Competition

Step-by-step explanation: Jerry is a price taker where there are a large number of buyers and sellers. This kind of a market structure is a perfectly competitive market.

Perfectly competitive market is governed by the following characteristics,

a. Identical/homogeneous goods

b. Large number of buyers and sellers

c. Free entry and exit

d. Perfect information

Therefore, Jerry is serving in a perfectly competitive market structure.