A market is said to be perfectly-competitive when: the market may be dominated by one or two major companies, but there are many smaller companies also in the market. there are any number of products, equivalent buying and selling prices, and individual buyers or sellers can affect those prices by their own actions. there is a homogeneous product, equivalent buying and selling prices, and no individual buyers or sellers can affect those prices by their own actions. there is no opportunity costs incurred by the vendor nor by the buyer. there are any number of products, equivalent buying and selling prices, and individual buyers or sellers can affect those prices by their own actions, but there are no opportunity costs for buyers or sellers.
A market is said to be perfectly-competitive when: the market may be dominated by one or two major companies, but there are many smaller companies also in the market. there are any number of products, equivalent buying and selling prices, and individual buyers or sellers can affect those prices by their own actions. there is a homogeneous product, equivalent buying and selling prices, and no individual buyers or sellers can affect those prices by their own actions. there is no opportunity costs incurred by the vendor nor by the buyer. there are any number of products, equivalent buying and selling prices, and individual buyers or sellers can affect those prices by their own actions, but there are no opportunity costs for buyers or sellers.
Chapter1: Making Economics Decisions
Section: Chapter Questions
Problem 1QTC
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![A market is said to be perfectly-competitive when:
the market may be dominated by one or two major companies, but there are
many smaller companies also in the market.
there are any number of products, equivalent buying and selling prices, and
individual buyers or sellers can affect those prices by their own actions.
there is a homogeneous product, equivalent buying and selling prices, and no
individual buyers or sellers can affect those prices by their own actions.
there is no opportunity costs incurred by the vendor nor by the buyer.
there are any number of products, equivalent buying and selling prices, and
individual buyers or sellers can affect those prices by their own actions, but
there are no opportunity costs for buyers or sellers.](/v2/_next/image?url=https%3A%2F%2Fcontent.bartleby.com%2Fqna-images%2Fquestion%2Fd829cb31-0ca8-4ff6-b02f-a2ae981c3ef7%2F39517e60-f851-4dd2-8357-d31c67ad34a4%2Fdeoqf3r_processed.jpeg&w=3840&q=75)
Transcribed Image Text:A market is said to be perfectly-competitive when:
the market may be dominated by one or two major companies, but there are
many smaller companies also in the market.
there are any number of products, equivalent buying and selling prices, and
individual buyers or sellers can affect those prices by their own actions.
there is a homogeneous product, equivalent buying and selling prices, and no
individual buyers or sellers can affect those prices by their own actions.
there is no opportunity costs incurred by the vendor nor by the buyer.
there are any number of products, equivalent buying and selling prices, and
individual buyers or sellers can affect those prices by their own actions, but
there are no opportunity costs for buyers or sellers.
![Soft Cushion Company is highly decentralized. Each division is empowered to make its own sales decisions. The
Assembly Division can purchase cushion stuffing from the Production Division or from external suppliers. The
Production Division has been the major supplier of stuffing in recent years. The Assembly Division has announced
that two external suppliers will be used to purchase the stuffing at $20 per kilogram for the next year. The Production
Division recently increased its unit price to $40. The manager of the Production Division presented the following
information; variable cost $32, fixed cost $8, to top management in order to attempt to force the Assembly Division to
purchase the stuffing internally. The Assembly Division purchases 20,000 kg per month.
What is the monthly operating advantage (disadvantage) of purchasing the goods internally assuming the Production
Division is able to utilize the facilities for other operations resulting in monthly cash-operating savings of $40,000?
$280,000
$(360,000)
$440,000
$40,000
$(280,000)](/v2/_next/image?url=https%3A%2F%2Fcontent.bartleby.com%2Fqna-images%2Fquestion%2Fd829cb31-0ca8-4ff6-b02f-a2ae981c3ef7%2F39517e60-f851-4dd2-8357-d31c67ad34a4%2Fae42nh_processed.jpeg&w=3840&q=75)
Transcribed Image Text:Soft Cushion Company is highly decentralized. Each division is empowered to make its own sales decisions. The
Assembly Division can purchase cushion stuffing from the Production Division or from external suppliers. The
Production Division has been the major supplier of stuffing in recent years. The Assembly Division has announced
that two external suppliers will be used to purchase the stuffing at $20 per kilogram for the next year. The Production
Division recently increased its unit price to $40. The manager of the Production Division presented the following
information; variable cost $32, fixed cost $8, to top management in order to attempt to force the Assembly Division to
purchase the stuffing internally. The Assembly Division purchases 20,000 kg per month.
What is the monthly operating advantage (disadvantage) of purchasing the goods internally assuming the Production
Division is able to utilize the facilities for other operations resulting in monthly cash-operating savings of $40,000?
$280,000
$(360,000)
$440,000
$40,000
$(280,000)
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