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Assumptions about the theory of supply and demand


In the context of markets, “perfect competition” means:

  1. - all participants have complete information,
  2. - there are no entry or exit barriers to the market,
  3. - there are no transaction costs or subsidies affecting the market,
  4. - all firms have constant returns to scale, and
  5. - all market participants are independent rational actors.
supply_and_demand_theory_assumptions.txt · Last modified: 2019/10/19 09:22 (external edit)