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Competition is the essential despot of the market economy

Evaluate and explain the statements: “Competition is the essential despot of the market economy”.

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Competition provides discipline in 2 ways:

1st it pressurize firm to look for the least-cost manufacture methods or face being driven out of business by their rivals.

2nd it avoid victorious manufacturer from charging whatsoever marketplace will bear. Prices of competition kept at level anywhere total revenue production includes a profit. As in a cut-throat market situation it is hard process and difficult to accomplish the equivalent results, this shown Experience.

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