Economics Perfect Competition Questions
In perfect competition, barriers to entry refer to the obstacles or restrictions that prevent new firms from entering the market and competing with existing firms. These barriers can take various forms and have different impacts on market dynamics. In a perfectly competitive market, there are typically no barriers to entry, meaning that new firms can freely enter and exit the market without any restrictions. This ensures that there is a large number of buyers and sellers, and no single firm has the power to influence market prices. As a result, perfect competition promotes efficiency, innovation, and consumer welfare.