Firms are assumed to be price takers in a perfectly competitive market because
a. they are not allowed by law to charge any price other than the market price
b. they must accept any price offered by consumers
c. they earn high enough profits at the market price, so they do not want to hurt consumers by raising their prices
d. each firm is too small to influence the market price
e. there are too few buyers in the market to absorb price changes
D
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When Xt is strictly exogenous, the following estimator(s) of dynamic causal effects are available:
A) estimating an ADL model and calculating the dynamic multipliers from the estimated ADL coefficients B) using GLS to estimate the coefficients of the distributed lag model C) neither (a) or (b) D) (a) and (b)
Which one of the following statements about public debt is most accurate? a. Poor people are burdened by the debt because they pay more in taxes than they receive in interest
b. Poor people gain from the debt because they pay less in taxes than they receive in interest. c. Wealthy people are burdened by the debt because they pay more in taxes than they receive in interest. d. Wealthy people gain from the debt because they pay less in taxes than they receive in interest. e. The debt affects the poor and rich people equally.
Explain the real-nominal principle.
What will be an ideal response?
When the price of pens went from $1 to $1.50, the quantity demanded of pencils changed from 50 to 75 a day. The cross-price elasticity of demand for pens (using the initial value formula) is:
A. 0.8. B. 0.4. C. 0.2. D. It cannot be determined from the information provided.