Perfect Competition (Online Lesson)

In this online lesson, we cover the market structure of perfect competition.

WHAT YOU'LL STUDY IN THIS ONLINE LESSON

• the characteristics and assumptions of perfect competition, and how it fits into the 'spectrum of competition'
• diagrammatic analysis of perfect competition in both the short run and the long run
• the efficiency of firms in perfect competition
• the real-world relevance of perfect competition

Additional teacher guidance is available at the end of this lesson. Thank you to Cathy Williams and Jon Clark for their contributions to this lesson.

HOW TO USE THIS ONLINE LESSON

Follow along in order of the activities shown below. Most are based on short videos, including activities for you to think about and try at home, as well as some extra worksheet-based activities.

If you would like to download a simple PDF worksheet to accompany the video activities, you can find it here. You can print it off and annotate it for your own notes, or make your own notes on a separate piece of paper to add to your school/college file.

ACTIVITY 1: VIDEO - WHAT IS PERFECT COMPETITION?

This video provides an introductory overview of the main characteristics and assumptions of perfect competition, along with some examples.

ACTIVITY 2: VIDEO - THE SHORT RUN, THE LONG RUN, AND RELEVANT DIAGRAMS

In perfect competition, there are different outcomes in both the short run and the long run. In this video, we explore those different outcomes and look at how to construct the associated diagrams.

ACTIVITY 3: THINKING TASK

Download this tutor2u worksheet on The Perfectly Competitive Potato, and practise your quantitative skills and diagram skills.

ACTIVITY 4: VIDEO - PERFECT COMPETITION AND EFFICIENCY

In this video, we consider some of the efficiency implications of perfect competition, in both the short run and the long run.

ACTIVITY 5: VIDEO - PERFECT COMPETITION AND THE REAL WORLD

This video explores both real-world applications and a consideration of the real-world relevance of perfect competition.

ACTIVITY 6: GAME - PERFECT COMPETITION CLEAR THE DECK

Have a go at this Clear the Deck matching activity for Perfect Competition.

ACTIVITY 7: MCQ QUIZ

Test your knowledge and understanding of perfect competition with these 20 MCQs. Download the questions here.

EXTENSION READING

Take a look at this article from The Economist, in which the competition expert Brink Lindsey is interviewed.

ADDITIONAL TEACHER GUIDANCE

This lesson comprises:

• just under 30 minutes of guided video content, spread across 4 videos, and also including around 20 minutes of student thinking and activity time
• an application task, the Perfectly Competitive Potato
• an MCQ activity (answers here)