Which market structure is characterized as a price taker?

The market structure characterized as a price taker is one where individual firms do not have the power to influence the market price of their goods or services. In pure competition, there are many firms competing against one another, and because products are homogeneous (identical), consumers will purchase from the firm offering the lowest price. As a result, individual firms must accept the market price as given and cannot charge more without losing all their customers to competitors.

In a purely competitive market, firms can sell as much as they want at the prevailing market price but will not sell anything if they attempt to set a price higher than the market price. This situation contrasts with other market structures, where firms may have some level of control over prices due to product differentiation or limited competition. Monopolistic competition features differentiated products allowing some price-setting ability, while oligopoly and monopoly allow even greater pricing power because of fewer competitors or a single seller, respectively.