Suppose a single egg farmer alters the number of eggs she produces but the change in egg output does not have any effect on the market price. This example describes which of the following characteristics of perfect competition?
A. large number of small firms
B. homogeneous product
C. very easy entry and exit
D. mutual interdependence
Answer: A
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If regulators disallow price increases requested by a natural monopoly that is currently earning an economic loss, quality of service will
A) increase rapidly. B) likely fall. C) remain unchanged. D) none of the above.
When the domestic currency depreciates, domestic goods become more expensive to foreign buyers
a. True b. False Indicate whether the statement is true or false
High prices do not occur in laissez-faire markets
a. True b. False Indicate whether the statement is true or false
Entrepreneurship is
a. restricted to perfect competition. b. occurs only in well-functioning markets. c. the process of planting new crops. d. the process of taking business risks.