Perfect competition is characterized by all of the following except:

• A. Products are homogeneous
• B. Firms are price takers
• C. There are significant barriers to entry
• D. There are many buyers and sellers

Answer: (C)

Verified step by step guidance

1. Understand the characteristics of perfect competition: it involves many buyers and sellers, homogeneous products, firms being price takers, and free entry and exit (no significant barriers to entry).
2. Review each option given in the problem and compare it to the known characteristics of perfect competition.
3. Identify that 'Products are homogeneous' is a true characteristic of perfect competition, meaning all firms sell identical products.
4. Recognize that 'Firms are price takers' means individual firms cannot influence the market price, which is also true in perfect competition.
5. Note that 'There are significant barriers to entry' contradicts the free entry and exit condition of perfect competition, so this is the exception.