In perfectly competitive markets, keeping up with changes in supply and demand can be really tough. These markets have many small businesses and very similar products. This makes it hard for any one company to change prices on their own.

1. Supply Fluctuations:

• When there is a sudden rise in supply, prices can drop quickly. This can hurt companies' earnings and profits.
• On the other hand, if there is less supply, prices can go up a lot. This means customers have to pay more.

2. Demand Fluctuations:

• When demand goes up suddenly, it can cause short supply. This makes it hard for companies to keep up with what customers want.
• If demand goes down, companies have to lower their prices, which can make it hard for them to stay in business.

3. Solutions:

• Businesses can use better stock management and plan ahead to prepare for changes.
• Improving how they make products can help reduce the bad effects of sudden supply changes.
• Working together with other companies to share information can also help keep the market stable.

Even with these possible solutions, perfectly competitive markets can still be very unpredictable. This can create big problems for both businesses and consumers.