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Q. Perfect Competition in neoclassical economics?
Perfect Competition: An abstract assumption, central to neoclassical economics, in that companies are so small that none can influence total output or price levels in an industry, none can anticipate or interact with the actions of its competitors and none can distinguish its products from those of competing firms. Perfect competition has never existed in real life; it's a theoretical assumption developed solely in order to defend internal logical integrity of neoclassical economic theories.
1. Consider the consumption decisions of R.B. Turbo, a new student at Teachers College, Columbia University. Ms. Turbo has only available $1,000 in monthly income to spend on food
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