How there is absence of transportation cost in a firm under perfectly competitive market structure
In a perfectly competitive market, it is assumed that all firms have equal access to the market. The goods are produced and sold locally; therefore the firms need not to incur any transportation cost to transport the finished product from one part of the market to the other. This further strengthens the existence of uniform price.
Implication- No firm can charge additional price as transportation costs, thereby uniform market price is guaranteed.
Implication- No firm can charge additional price as transportation costs, thereby uniform market price is guaranteed.