Which of the Following Statements Is TRUE About Contestable Markets

question 34

Multiple Choice

Which of the following statements is TRUE about contestable markets?

• A)There are significant barriers to entry.
• B)Firms earn large economic profits.
• C)Each firm faces a perfectly elastic demand.
• D)There are few firms in the industry.
• E)The Herfindahl-Hirschman Index is close to zero.

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Definitions:

Perceptual Constancy

The psychological phenomenon that allows humans to perceive objects as unchanging despite changes in sensory input, such as changes in illumination, angle, or distance.

Changing Shapes

The process of transformation or alteration in the form or appearance of an object or entity.

Centrality

Refers to the importance or influence of a certain node within a network, highlighting its role in facilitating or hindering the flow of information or resources.

Organizational Subunit

A division or smaller segment within an organization that focuses on specific tasks or goals.