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Summary AQA A-Level Economics: 4.1.5.3 Perfect competition $9.01
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Summary AQA A-Level Economics: 4.1.5.3 Perfect competition

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From the AQA A Level Economics specification: • The formal diagrammatic analysis of the perfectly competitive model in the short and long run. • The implications of the following for the behaviour of firms and the industry: large numbers of producers, identical products, freedom of entry a...

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4.1.5.3 Perfect competition

Features of perfect competition:

• Many small buyers and sellers – lots of competition

• No barriers to entry or exit – easy to enter/ exit market

• Homogeneous products – same products

• Perfect information -



Perfectly elastic demand means consumers are extremely responsive to price changes! If a firm puts
their price up by a small amount, their consumers will stop buying from them completely because
they’re so sensitive to price changes. They’ll immediately switch to another seller in the market.




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