Question

Identify the correctly matched pair in Column A and Column B from the following:

Column A		Cloumn B
(1)	Product differentiation	(a)	Feature of Perfect Competition
(2)	Firms sell homogeneous products	(b)	Feature of Perfect Competition
(3)	Optimal allocation of resources in the long run	(c)	Limitation of Perfect Competition
(4)	Firms are price makers	(d)	Advantage of Perfect Competition

Options

• 1 - (a)

• 2 - (b)

• 3 - (c)

• 4 - (d)

Answer 1

2 - (b)

Explanation:

The fact that enterprises sell homogeneous products is a key element of perfect competition. Homogeneous products are identical in terms of quality, size, and color. They are identical to one another and hence serve as excellent alternatives for one another.