A resource is rare if the number of companies that own it is less than the number of companies needed to reach a state of perfect competition.
It is an economic situation where there is an imbalance between supply and demand. When there is a rare resource available, companies have greater dominance over the market and over the price of the resource and negatively impact consumers.
Therefore, a situation of perfect competition is ideal for the consumer, who has several options of goods and services available at different prices.
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