In which market model are the conditions of entry into the market easiest?

• A. Perfect competition
• B. Monopoly
• C. Oligopoly
• D. Monopolistic competition

Answer: (A)

Verified step by step guidance

1. Understand the concept of market entry conditions, which refers to how easy or difficult it is for new firms to enter a market and start competing.
2. Recall the characteristics of each market model: Perfect competition, Monopoly, Oligopoly, and Monopolistic competition.
3. In Perfect competition, there are many firms, identical products, and no barriers to entry, meaning new firms can enter freely.
4. In Monopoly, there is a single firm with high barriers to entry, such as legal restrictions or high startup costs, making entry very difficult.
5. In Oligopoly and Monopolistic competition, there are some barriers to entry, but they are generally higher than in perfect competition and lower than in monopoly.