Which of the Following Is Characteristic of a Perfectly Competitive

question 89

Multiple Choice

Which of the following is characteristic of a perfectly competitive market?

• A) There is free entry into and exit from the market.
• B) Individual firms can exert a perceptible influence on the market price.
• C) The firms in the market produce differentiated products.
• D) All of these are true.

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Definitions:

Standardized Product

Goods or services that are uniform in quality and characteristics across various producers, allowing them to be interchangeable and often leading to competition based on price.

Elastic Demand

Refers to a situation where the quantity demanded for a product or service changes significantly in response to changes in its price.

Pure Monopolist

A single seller in a market with no close substitutes for the product, resulting in complete market control.

Pure Competitor

A market participant in an industry where many sellers offer identical products, and no single seller can influence market price.