Which of the Following Is a Characteristic of a Competitive

question 179

Multiple Choice

Which of the following is a characteristic of a competitive price-taker market?

• A) Profit maximizing firms in the market will expand output until price equals average variable cost.
• B) The market demand curve for the product is a horizontal line.
• C) There are many firms in the market, each producing a small share of total market output.
• D) The product produced by each of the firms is differentiated.

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Definitions:

Cognitive Dissonance

A psychological state characterized by experiencing conflicting thoughts, beliefs, or attitudes, especially relating to behavioral decisions and attitude change.

Z Problem-Solving Model

An approach to problem-solving that integrates both analytical and intuitive strategies, often represented in four stages resembling the letter "Z".

Nonpreferences

The absence of a preference or inclination towards any particular option or choice.

Emotion in Decision Making

The influence that feelings and emotional responses have on the process of making choices or judgments.