Question

Why are some producers forced to sell their products at the prevailing market price?

Answer 1

Answer:

High degree of similarity to competitor's products

Explanation:

In the situation of a perfect competitive markets, the manufacturers are accepts the market price, they cannot influence the prices of goods in a market.

When such cases arise, manufacturers are compelled to sell their goods at current market prices. Since goods sold in the market are similar and in most cases prices are usually the same. Hence they are not allowed to influence the price by setting a price above the equilibrium price in the market, and in case a manufacturer try such, customers will move else where to get similar product at a less price.

Answer 2

Answer: High degree of similarity to competitors products.

Explanation:

In a perfectly competitive markets, the producers are price takers as the producers cannot influence the prices of goods in a market.

In such cases, producers are forced to sell the goods at current market prices. Good sold in the market are similar and prices are usually the same. If a producer influences his or her price by setting a price above the equilibrium price in the market, the customers will move and purchase the product from other producers.