Which of the Following Best Explains Why Price in Competitive

question 399

Multiple Choice

Which of the following best explains why price in competitive price-taker markets will tend to be driven to the minimum per-unit cost?

• A) homogeneous products.
• B) few sellers.
• C) firms face downward-sloping demand curves.
• D) free entry and exit.

---

Definitions:

Fair Value

The price that would be received to sell an asset or paid to transfer a liability in an orderly transaction between market participants at the measurement date.

Parent-Company Extension Method

An accounting approach used in consolidation, where the parent company's financial statements extend to include the subsidiary's transactions and balances.

Goodwill

Goodwill is an intangible asset that arises when a company acquires another business for more than the fair value of its net identifiable assets.

NCI

Non-Controlling Interest, which refers to the equity in a subsidiary not attributable, directly or indirectly, to the parent company.