Explain the implications of the following in a perfectly competitive market:
Large number of buyers
Explain the implication of a large number of buyers in a perfectly competitive market.
A large number of buyers:- A perfectly competitive market is a market which consists of a large number of buyers and sellers. They produce a homogeneous product. When the number of buyers is more, the demand of an individual buyer is only a small portion of the market demand. Individual buyers cannot influence the market price of a good by varying their demands, and thus, an individual buyer is a price taker and not a price maker.