Which statement describes a necessary condition for perfect competition?

A) A small number of firms control a large share of the total market.
B) Movement into and out of the market is limited.
C) Firms produce a standardized product.
D) Extensive advertising is used to promote the firm's product.

Perfect Competition

A market structure where numerous small firms compete against each other, selling identical products, leading to optimal pricing and output levels.

Standardized Product

A product that is uniform in quality and produced in large quantities by many different firms.

Market Share

The portion of a market controlled by a particular company or product, often expressed as a percentage of total sales in the industry.