Perfect Competition Models - What Are They?

Perfect competition models are one of the most commonly taught, sort of workhorse models in micro economic courses. They assume an infinite number of firms and all of them are price takers. If those exhibit all of these properties, there is an abstract price setting mechanism which everyone takes as a price but has no influence over it. In other words, you can then make this claim that the world is as good as it could possibly be because of the market. But matte is completely right to say that, in fact, no economy really resembles this. The fed has got little to complain about from that side. And if that's the case, then these firms don't have some abstract market to worry