In a Perfectly Competitive Market,which of the Following Increases the Price

question 19

Multiple Choice

In a perfectly competitive market,which of the following increases the price that the firms charge in the short run?

• A)an increase in the number of firms
• B)an increase in the price of a good that is a complement of the good produced in this market
• C)an increase in market supply
• D)a decrease in the price of a good that is a substitute for the good produced in this market
• E)an increase in market demand

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Definitions:

First-Mover Advantage

In game theory, the benefit obtained by the party that moves first in a sequential game. A situation that occurs in a sequential game if the player who gets to move first has an advantage in terms of final outcomes over the player(s) who move subsequently.

Simultaneous Game

A strategic interaction (game) between two or more parties (players) in which every player moves (makes a decision) at the same time.

Collusive Oligopoly

A market condition where a small number of firms illegally agree to set prices or output levels to maximize collective profits.

Noncollusive Oligopoly

A market structure where a few firms dominate but do not explicitly coordinate their pricing and output decisions, leading to competitive but interdependent market outcomes.