Why Does a Perfectly Competitive Firm NOT Have Influence Over

question 141

Multiple Choice

Why does a perfectly competitive firm NOT have influence over price?

• A) Antitrust laws constrain perfectly competitive firms.
• B) Its output is insignificant relative to the market as a whole.
• C) Consumers establish the prices of products.
• D) It is unaware of the demand curve it faces.

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Definitions:

Income Tax Expense

The amount of money a company is required to pay in taxes based on its taxable income, accounted for in the income statement.

Deferred Tax Liability

A tax obligation that a company owes but is not required to pay until a future date, often resulting from differences in accounting practices.

Tax Laws

The legal standards and regulations governing the collection of taxes by the government from individuals and entities.

Deferred Tax Liability

A tax obligation that a company owes but does not have to pay until a future date, usually due to timing differences between accounting practices and tax laws.