In a perfectly competitive market, the equilibrium price
a. is determined by all the buyers in the market but no single buyer is able to influence it
b. is determined by all the sellers in the market but no single seller is able to influence it
c. adjusts until the quantity supplied by all sellers is equal to the quantity demanded by all buyers
d. is not influenced by the cost structure of the firms in the market
e. is not influenced by the preferences of the consumers in the market
C
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Property rights are relatively secure and free from the threat of nationalization in the HPAE
Indicate whether the statement is true or false
If marginal cost is less than average total cost, then ________ is ________
A) average total cost; falling B) average variable cost; falling C) marginal cost; falling D) marginal cost; rising
Using Figure 9.1, explain what a firm would do in the short run if the market price of its product were at P4 and it produced Q4 . Is the firm earning an economic profit? Explain
What will be an ideal response?
A disadvantage of the proprietorship form of business organization is
A) its limited access to capital. B) its limited liability. C) that it can issue only one class of stock. D) that the owner must fight a lot of red tape to form the firm.