In a Contestable Market

question 93

Multiple Choice

In a contestable market,

• A) Product differentiation results in nonprice competition as well as price competition.
• B) There are economies of scale that heighten competition.
• C) Barriers to entry and long-run economic profits are low.
• D) Many firms compete in producing a standardized product.

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Definitions:

Input Market

Markets where firms purchase resources and services needed for the production process, such as labor, raw materials, and machinery.

Labor Union

An organization of workers formed to protect and further their rights and interests through collective bargaining.

National Labor Relations (Wagner) Act

A 1935 United States federal law that protects the rights of employees to organize, form unions, and engage in collective bargaining, while prohibiting certain unfair labor practices.

Coercion or Interference

Actions or practices that force or unduly influence someone to act in a way that they would not otherwise choose.