perfect information

Examples of perfect information in the following topics:

• Defining the Security Market Line

  • It is a hypothetical construct based on a world of perfect information.
  • In the absence of perfect information, we can more or less assume historical data will give us an accurate expectation of what kind of returns and risk to expect with a particular investment of capital.
  • In a perfect world, with perfect information, any capital investment is on the security market line.

• Definition of Perfect Competition

  • Perfect competition is a market structure that leads to the Pareto-efficient allocation of economic resources.
  • Perfect competition: An industry structure in which there are many firms, none large enough to influence the industry, producing homogeneous products.
  • Perfect competition leads to the Pareto-efficient allocation of economic resources.
  • Both buyers and sellers have perfect information about the price, utility, quality, and production methods of products.

• Summary of the Types of Intervals

  • Here is a quick summary of the above information, for reference.
  • A perfect prime is often called a unison.
  • A perfect octave is often simply called an octave.
  • An augmented interval is one half step larger than the perfect or major interval.
  • A diminished interval is one half step smaller than the perfect or minor interval.

• Market Differences Between Monopoly and Perfect Competition

  • At one extreme is perfect competition.
  • In a perfectly competitive market, there are many producers and consumers, no barriers to enter and exit the market, perfectly homogeneous goods, perfect information, and well-defined property rights.
  • There are few differences in quality between providers so goods can be easily substituted, and the goods are simple enough that both buyers and sellers have full information about the transaction.
  • Monopoly and perfect competition mark the two extremes of market structures, but there are some similarities between firms in a perfectly competitive market and monopoly firms.
  • Perfect competition produces an equilibrium in which the price and quantity of a good is economically efficient.

• Introduction to Property Rights and Markets

  • The optimal solution to the allocation problem requires the participants to have accurate information about the marginal costs and marginal benefits associated with specific alternatives.
  • The information about MC and MB revealed by market exchanges (like all information) is never perfect.
  • Pure competition is one way to ensure that no one buyer or seller has the ability to alter the outcome of market exchanges and the information revealed in prices.
  • The existence of market power allows a buyer or seller to influence the outcome of a market exchange and distort the information about MB and MC.
  • Attenuated or weakened property rights also may distort information about MB and/or MC and result in an allocation that is less than optimal.

• Classifying Intervals

  • What makes these particular intervals perfect?
  • (For more information on this, see Frequency, Wavelength, and Pitch and Harmonic Series. ) Because they are so closely related, they sound particularly good together, a fact that has been noticed since at least the times of classical Greece, and probably even longer.
  • A perfect prime is also called a unison.
  • A perfect 5th is 7 half-steps.
  • A perfect fourth is 5 half-steps.

• Verbal Aspect: Simple, Progressive, Perfect, and Perfect Progressive

  • Aspect gives us additional information about a verb by telling us whether the action was completed, continuous, neither, or both.
  • There are four main aspects: simple, progressive, perfect, and perfect progressive.
  • Verbs in future perfect express actions that will be completed in the future.
  • The perfect progressive, just as you would expect, is a combination of the perfect and progressive aspects.
  • Perfect progressive refers to the completed portion of an ongoing action.

• Verbal Aspect: Simple, Progressive, Perfect, and Perfect Progressive

• Laying the groundwork

  • Practice makes perfect.
  • Displaying work processes on post-it notes and rearranging them on a big board makes it easy to move and add new information.

• Dividend Irrelevance Theory

  • Under perfect market conditions, stockholders would ultimately be indifferent between returns from dividends or returns from capital gains.
  • Under these frictionless perfect capital market assumptions, dividend irrelevance follows from the Modigliani-Miller theorem.