Which of the Following Best Explains Why a Firm in a Competitive

question 194

Multiple Choice

Which of the following best explains why a firm in a competitive price-taker market must take the price determined in the market?

• A) The short-run average total costs of firms that are price takers will be constant.
• B) If a price taker increased its price, consumers would buy from other suppliers.
• C) Firms in a price-taker market will have to advertise in order to increase sales.
• D) There are no good substitutes for the product supplied by a firm that is a price taker.

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Definitions:

Peripheral Nervous System

Part of the nervous system that consists of the nerves and ganglia outside of the brain and spinal cord.

Efferent Fibers

Nerve fibers that carry signals away from the central nervous system to the peripheral effectors, such as muscles and glands.

Cranial Nerves

Twelve pairs of nerves that emerge directly from the brain, not through the spinal column, serving various sensory and motor functions of the head and neck.

Asymmetry

The lack of equality or equivalence between parts or aspects of something; not symmetrical.