How is ease of market entry and exit and exit related to the number of suppliers in a purely competitive market?

Question

Milagros Reyes

Business

27 January, 23:41

How is ease of market entry and exit and exit related to the number of suppliers in a purely competitive market?

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Answers (1)

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Bradley Swanson · Answer 1

Numbers of suppliers in a purely competitive market dictate how easy it is to start a business or transform it in that sector.

Explanation:

Entry an d Exit in a business sector means the ease of starting or transforming a business that is involved in a particular market sector.

In a purely competitive market the business is dictated by the market standards set by the completion of the various companies vying for a market share between each other.

The harder the competition at the top level, the harder it is for a new business to come up, similar is the case for when one or two companies dominate the hegemony in which case it is hard to grab a market share for the new entrant in the market.