In a Market That Lacks Sufficient Competition

question 157

Multiple Choice

In a market that lacks sufficient competition,

• A) output will generally be less than the output that is ideal from the standpoint of economic efficiency.
• B) output will generally be greater than the output that is ideal from the standpoint of economic efficiency.
• C) price will generally be less than the price that would result if the market was competitive.
• D) profit rates will generally be so low that government subsidies will be necessary to ensure that the firms remain in business.

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Definitions:

Imputed Knowledge

Information or knowledge attributed to a person, typically within a legal context, even if they were not directly aware of it.

Material Information

Information that would influence the decision-making process of a reasonable person or investor in determining a course of action.

Partnership Affairs

Refers to the internal business activities, decisions, and operations managed collectively by partners within a business partnership.

Silent Partners

Investors in a business who contribute capital but do not participate in management or daily operations, and typically their existence is not widely known.