A market structure in which the following five criteria are met:1) All
firms sell an identical product;2) All firms are price takers - they
cannot control the market price of their product;3) All firms have a
relatively small market share;4) Buyers have complete information about
the product being sold and the prices charged by each firm; and5) The
industry is characterized by freedom of entry and exit.Perfect
competition is sometimes referred to as "pure competition"
Perfect competition is a theoretical market structure. It is primarily
used as a benchmark against which other, real-life market structures are
compared. The industry that most closely resembles perfect competition
in real life is agriculture.