If a Perfectly Competitive Firm Raised the Price of Its

question 242

Multiple Choice

If a perfectly competitive firm raised the price of its product,

• A) its profits would increase.
• B) the quantity of output it sells decreases to zero.
• C) rival firms will follow suit and raise their prices also.
• D) the firm will be forced to advertise more.
• E) its total revenue would rise but its total cost would rise by more.

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Definitions:

Repeated Measures Design

An experimental design in which the same subjects are exposed to each condition or treatment, allowing direct comparison of different treatments on the same subjects.

Factorial Design

A type of experimental design that allows researchers to examine the effect of two or more variables simultaneously by changing them together, not just one at a time.

Participants

Individuals who take part in a research study, often providing data through their behavior, responses, or physiological reactions.

Factorial Design

An experimental design that allows researchers to study the effects of two or more independent variables simultaneously on a dependent variable.