Which of the Following Statements Is True of Perfect Competition

question 221

Multiple Choice

Which of the following statements is true of perfect competition?

• A) The outcome in a perfectly competitive market is Pareto inefficient.
• B) The total value of production across a perfectly competitive industry is maximized.
• C) Firms under perfect competition produce at a point where price is greater than marginal cost.
• D) Consumers in a competitive market purchase at a point where marginal utility is greater than price.

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Definitions:

Milgram Experiment

A psychological experiment conducted by Stanley Milgram in the 1960s to study obedience to authority, where participants were instructed to administer electric shocks to another person.

Stanford University Prison Experiment

A psychological study conducted by Philip Zimbardo in 1971 at Stanford University, where students were assigned roles of prisoners and guards to explore the effects of perceived power.

Generalization

Drawing a conclusion about a certain characteristic of a population based on a sample from it.

Logical Support

The provision of reasons or evidence to justify a claim or argument.