Jim Marsh, CFA and Katherine Shipley, are discussing the various types of market structures and their characteristics. During their discussion, Jim makes the following statements: I: “Perfect competition assumes that all the firms in the market produce identical products, there are a large number of independent firms and there are no barriers to entry or exit.” II: “Perfect competition also assumes that each seller is small relative to the size of the total market.” Katherine says, III: “Firms in perfect competition are price searchers, whereas firms in monopolistic competition face downward-sloping demand curves and are price takers.” Which of the statements made by Jim and Katherine is/are most likely incorrect?Only statement I is incorrectBoth statements I and II are incorrectOnly statement III is incorrect

bummer, I read the answer choices wrong :s

A CFA Level 1 Discussion About CFA Level 1 Question Of The Week: Market Structures

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