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In this topic, we will discuss the difference between perfect and imperfect competition, and explain how imperfect competition may have affected the growth and development of the telecommunications sector in Malaysia. 3.1 The difference between perfect and imperfect competition It is traditional to divide industries into categories according to the degree of competition that exists between the firms within the industry. There are four such categories. At one extreme is perfect competition, where there are very …

…to capture a larger share of the market, and it may be some time before rivals can respond with a similarly improved product. If, in addition, costs are lowered by technological improvement the firm's capacity to withstand any price war. Non-price competition through product differentiation may result in greater choice for the consumer. Take the case between Maxis and Digi. Non-price competition has led to a huge range of different value set for different consumers.