Which of the Following Statements Is False

question 9

Multiple Choice

Which of the following statements is false?

• A)The perfectly competitive firm's demand curve is horizontal at the market price.
• B)The theory of perfect competition is completely and accurately descriptive of most real-world firms.
• C)If Firm X does not strictly meet all the assumptions of the theory of perfect competition, but behaves as if it does, then the theory of perfect competition is relevant to it.
• D)In perfect competition, the market price is established at the intersection of the market demand and market supply curves.

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Definitions:

Corporation

A legal entity formed by individuals, stockholders, or shareholders, with its own rights and liabilities separate from those of its members.

Promoters

Individuals or companies that are involved in the planning and establishment of a company, or those who actively support or recommend something.

Stock Dividend

A distribution of additional shares to shareholders at no extra cost, based on the number of shares they already own.

Corporation's Assets

Resources owned by a corporation that have economic value and can contribute to the company's future income and benefits.