Suppose a Market Is Initially Perfectly Competitive with Many Firms

question 177

Multiple Choice

Suppose a market is initially perfectly competitive with many firms selling an identical product. Over time, however, suppose the merging of firms results in the market being served by only three or four firms selling this same product. As a result, we would expect

• A)an increase in market output and an increase in the price of the product.
• B)an increase in market output and an decrease in the price of the product.
• C)a decrease in market output and an increase in the price of the product.
• D)a decrease in market output and a decrease in the price of the product.

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Definitions:

Liver

A large vital organ in vertebrates responsible for detoxification, protein synthesis, and biochemical production necessary for digestion and metabolism.

Goblet Cells

Specialized epithelial cells found in the respiratory and intestinal tracts, secreting mucus to lubricate and protect the mucous membranes.

Granular Cells

Cells containing granules that release substances involved in various bodily functions, such as inflammation or blood pressure regulation.

Nutrients

Substances obtained from food that are essential for the maintenance of bodily functions and growth.