Perfectly competitive industries are characterized by: few sellers and many buyers. consumers who can differentiate between products. identical goods. a few producers that account for most of the market share.

Perfectly competitive industries are characterized by: few sellers and many buyers. consumers who can differentiate between products. identical goods. a few producers that account for most of the market share.

Economics (MindTap Course List)

13th Edition

ISBN:9781337617383

Author:Roger A. Arnold

Publisher:Roger A. Arnold

Chapter22: Perfect Competition

Section: Chapter Questions

Problem 3QP

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Perfectly competitive industries are characterized by:
few sellers and many buyers.
consumers who can differentiate between products.
identical goods.
a few producers that account for most of the market share.

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Perfectly competitive industries are characterized by: few sellers and many buyers. consumers who can differentiate between products. identical goods. a few producers that account for most of the market share.
The demand for each seller's product in perfect competition is horizontal at the market price because each seller is too small to affect market price. the price is set by the government. all the sellers get together and set the price. all the demanders get together and set the price.
Which of the following is NOT a requirement for a market to be perfectly competitive?
Which of the following characteristics does NOT describe a perfectly competitive market? Group of answer choices Firms set different prices for their product, either at or above the equilibrium price. Many firms are producing identical products Companies are able to enter and exit the market without any restrictions. There are many people who desire and have the ability to purchase the product.
In the long run, when there are economic losses, firms leave the industry, which will decrease the market supply and increase the price until economic losses are zero. True False
In a perfectly competitive market, firms that remain in the market in the long run produce at the efficient scale because minimizing costs always maximizes profits. markets are always efficient. their supply curve is horizontal. they are price takers and must make zero profits in the long run.
How can a business compete with other businesses that sell the same products? Lower the price of the competing item. Produce less of the competing item. Raise the price of the competing item. Produce more of the competing item.
Which statement best explains how a perfect competition market structure determines the price of a product? A government controls the market and sets the price of a product. Consumers in the market agree to only pay a certain price for a product. The interaction of consumers and businesses determines the price. A small number of large businesses secretly agree to fix the price.
Which of the following are characteristics of a perfectly competitive market? Check all that apply. There is a large number of firms in the market. Entry and exit are difficult. The product is homogeneous. There are very few firms. Does a Kansas wheat farmer operate in a perfectly competitive market structure? No, because there is no easy entry into or exit from the wheat market. Yes, because the wheat market conforms closely to the perfectly competitive market structure. No, because no real-world market closely fits the three assumptions of perfect competition. Yes, because there are very few wheat farms.
Which of the following is not a characteristic of a perfectly competitive market. One firm's product is a perfect substitute for every other firm's product. There are no barriers to entry. Sellers are price makers. It has many buyers.
Which one of the following is NOT a requirement for or characteristic of perfect competition? The good must be homogeneous (standardised). All market participants should have perfect knowledge of market conditions. Every firm must have the power to set its own price. There must be a large number of sellers. There should be no government intervention. A small farmer is more likely to operate in a perfectly competitive market than a company like SABMiller because: A small business is more likely to keep close control on costs than a large firm. SABMiller employs many people, whereas perfectly competitive firms are owner managed. The demand for beer is less elastic than the demand for food. A small farmer supplies a small share of market supply. Farming is more risky than beer production.
All markets that are not perfectly competitive have which of the following characteristics? Each firm's marginal revenue is always equal to the market price. The product that each firm sells has no close substitutes. Firms in the market have some control over price, that is, each firm faces a downward sloping demand curve. Firms will produce a level of output where marginal cost equals the minimum level of average cost.