Which of the Following Statements Is True of a Perfectly

question 183

Multiple Choice

Which of the following statements is true of a perfectly competitive market?

• A) At equilibrium, it is possible to make someone better off without making someone else worse off.
• B) The equilibrium price in a competitive market efficiently allocates scarce resources to participants.
• C) The equilibrium price is determined by a few large firms in the market.
• D) The sum of consumer surplus and producer surplus is not maximized at the equilibrium.

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Definitions:

Communicating Effectively

The process of clearly conveying information, ideas, or feelings to others through verbal, written, or non-verbal means.

Interviewee Comfort

The state of being at ease and relaxed during an interview, often resulting in more genuine and open communication.

Price Floor

A government or regulatory-imposed minimum price set above the equilibrium price, preventing market prices from falling below it.

Producer Surplus

The difference between what producers are willing to accept for a good versus what they actually receive, measured as the area above the supply curve and below the market price.