In Competitive Price-Taker Markets, If One Firm Raises Its Price

question 155

Multiple Choice

In competitive price-taker markets, if one firm raises its price,

• A) others will follow
• B) that firm will increase its revenues
• C) that firm will lose revenues because other firms will not follow
• D) all consumers will be adversely affected
• E) the market demand curve will shift

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Definitions:

Motorcycle Accidents

Incidents involving motorcycles that result in damage or injury.

Availability Heuristic

A mental shortcut that relies on immediate examples that come to a person’s mind when evaluating a specific topic, concept, method, or decision.

Muggings

Acts of attacking someone with the intent to rob them, often using violence or the threat of violence.

Heuristics

Simple, efficient rules, either hard-coded by evolutionary processes or learned, that help in making decisions, forming judgments, or solving problems.