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:

Residual Value

Residual value is the estimated value of an asset at the end of its useful life, reflecting what it could be sold for or its salvage value.

Fixed-Percentage Method

The Fixed-Percentage Method is a depreciation technique where a constant percentage of the asset's book value is depreciated each year, resulting in decreasing annual depreciation expenses.

Residual Value

The estimated amount that an asset is expected to realize upon its disposal at the end of its useful life.

Annual Depreciation

The portion of the total cost of a tangible asset that is expensed each year over its useful life.