Which of the Following Statements Is True of Competitive Market

question 95

Multiple Choice

Which of the following statements is true of competitive market equilibrium?

• A) The determination of equilibrium price and quantity is independent of the demand for goods.
• B) Social surplus is minimized at the competitive equilibrium.
• C) At the competitive equilibrium, there are no unexploited gains from trade.
• D) A competitive equilibrium is determined only by a few large sellers in the market.

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Definitions:

Economists

Individuals dedicated to analyzing the creation, dissemination, and consumption patterns of goods and services.

Decisions

The act of making choices between alternatives to achieve a goal or solve a problem.

Efficiency

The extent to which resources are used in the most productive way possible to produce desired goods and services while minimizing waste or inefficiency.

Economic Pie

A metaphorical representation of the total wealth or economic resources available for allocation or distribution within an economy.