Competitive Firms Cannot Individually Affect Market Price Because

question 55

Multiple Choice

Competitive firms cannot individually affect market price because

• A)There is an infinite demand for their goods.
• B)Demand is perfectly inelastic for their goods.
• C)Their individual production is insignificant relative to the production of the industry.
• D)The government exercises control over the market power of competitive firms.

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Definitions:

Theories

Systematic sets of ideas or principles that explain phenomena and are supported by evidence.

Intelligence

The skill to absorb lessons from lived experiences, resolve difficulties, and employ learning to adapt to unfamiliar scenarios.

Howard Gardner

An American developmental psychologist known for his theory of multiple intelligences.

Naturalistic Observation

A study technique that consists of watching participants in their normal surroundings without any intervention.