1. How many products does a perfectly competitive firm produce, and for how much is the product charged? Perfectly competitive firms produce the quantity of output at which marginal revenue equals marginal cost; they charge the equilibrium price for their product.

2. Profit is a signal for a perfectly competitive market - easy entry is an aspect of a perfectly competitive market. In other words, firms that are currently not in market X can easily get into that market. Nothing is holding them out. As long as sellers are earning profits in that market, the answer is yes.

• Demand and supply determines price leading to less profit for traders

Example- If my farmers' market decided to charge more than what the other markets charge, I will not experience profit. This is because the products the markets are selling are identical. Therefore, if there's a rise in price in one market, consumers will go to the cheaper market.

Lack of Innovation

• Firms have no incentive to innovate or spend on research and development.

  
  

• Entering the market and sales get easy for sellers as well as leaving the market

Example- In the case of Uber, the main Barrier to Entry is the license. Barriers to entry are less and the cost of changes are also less on both supply sides (drivers) and demand side(customers). Same goes if desired to exit.

Benefits Consumers

• Keeps prices low, and the quantity and choices of goods and services high