In the Long Run, in a Price-Taker Market, the Price

question 126

Multiple Choice

In the long run, in a price-taker market, the price of a good is determined primarily by the

• A) average total cost of producing it.
• B) decision of buyers in determining how much they are willing to pay for the good.
• C) elasticity of supply.
• D) number of firms in the industry.

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Definitions:

Balance Sheet Account

An account found on the balance sheet, which is one of the three principal financial statements; these accounts include assets, liabilities, and shareholders' equity.

Depreciation Expense

The portion of the cost of an asset that is allocated as an expense over its useful life, reflecting the decrease in value over time.

Overstate Assets

Reporting a company's assets at a value higher than their actual worth, which can inaccurately represent financial health.

Unearned Revenue Account

An account representing cash received for goods or services not yet provided; considered a liability until the service or product is delivered.