Why are individual buyers and sellers in perfect competition called price takers?
What will be an ideal response?
They are called price takers because each firm and customer are too small to influence the market price and has to take the market price as given.
You might also like to view...
How are goods and services produced in the global economy?
A. Developing countries use less human capital but just as much physical capital as advanced economies. B. Emerging economies use more capital-intensive technology than do developing economies. C. Human capital in all economies is similar. D. Advanced economies use less capital than developing economies.
In an open economy, an increase in savings because of concerns about the future should cause the domestic real interest rate to ________ and should cause net exports to ________
A) rise; rise B) rise; fall C) fall; rise D) fall; fall
The opportunity cost of an action:
a. is equal to the marginal cost of an action b. is equal to explicit cost c. is equal to the cost of the next best alternative forgone d. is the total cost of an action
Refer to the information provided in Table 20.1 below to answer the question(s) that follow. Table 20.1
Refer to Table 20.1. Mexico has
A. a comparative advantage but not an absolute advantage in orange production. B. an absolute advantage and a comparative advantage in orange production. C. an absolute advantage and a comparative advantage in banana production. D. a comparative advantage but not an absolute advantage in banana production.