A Firm Has Market Power If It Can

question 427

Multiple Choice

A firm has market power if it can

• A)maximize profits.
• B)minimize costs.
• C)influence the market price of the good it sells.
• D)hire as many workers as it needs at the prevailing wage rate.

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Definitions:

Common Stock

A type of ownership in a corporation that entitles holders to vote on corporate matters and receive dividends.

Cash Increase

The rise in the amount of cash and cash equivalents that a company has during a particular period, often resulting from operational activities, financing, or investments.

Statement of Cash Flows

A document that outlines the overall cash income from both the operational efforts and investment income of a company, and the expenditure on business activities and investment payments over a specified period.

Operating Activities

Activities related to the day-to-day functions of a business involved in producing and selling its products or services.