Question

why is pure competition considered an unsustainable system?

producers cannot make a profit if they keep dropping their prices.

price differentiation is often too minimal to matter.

consumers cannot distinguish between products.

few barriers exist to entry, meaning that the market inevitably floods.

Explanation:

In pure competition, producers face intense price - cutting pressure. If they keep dropping prices, they may not be able to cover costs and make a profit. This lack of profitability for producers makes the system unsustainable as businesses need to earn profits to stay in operation.

Answer:

Producers cannot make a profit if they keep dropping their prices.