Contestable Markets Tend to Arise When

question 128

Multiple Choice

Contestable markets tend to arise when:

• A) fixed costs are high.
• B) the threat of new firms entering the market is low.
• C) the incumbent firm does not control access to an important resource.
• D) government regulations are in effect.

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Definitions:

Quantity Demanded

The total amount of goods or services that consumers are willing and able to purchase at a given price over a specific time period.

Demand Curve

The demand curve is a graphical representation showing the relationship between the price of a good and the quantity demanded by consumers, typically downward sloping.

Quantity Demanded

The total amount of a good or service that consumers are willing and able to purchase at a given price in a given time period.

Demand Curve

A graph showing the quantity of a good that consumers are willing and able to purchase at various prices.