why is pure competition considered an unsustainable system?\nprice differentiation is often too minimal to…

why is pure competition considered an unsustainable system?\nprice differentiation is often too minimal to matter.\nfew barriers exist to entry, meaning that the market inevitably floods.\nconsumers cannot distinguish between products.\nproducers cannot make a profit if they keep dropping their prices.

why is pure competition considered an unsustainable system?\nprice differentiation is often too minimal to matter.\nfew barriers exist to entry, meaning that the market inevitably floods.\nconsumers cannot distinguish between products.\nproducers cannot make a profit if they keep dropping their prices.

Answer

Brief Explanations:

In pure - competition, there are many firms with identical products and free entry. As more firms enter due to low entry barriers, supply increases. Producers keep dropping prices to compete, and eventually, they cannot make a profit, making the system unsustainable.

Answer:

Producers cannot make a profit if they keep dropping their prices.