Harry Smith Sells Wheat in a Price-Taker Market

question 181

Multiple Choice

Harry Smith sells wheat in a price-taker market. With regard to Smith's price and output choices, which of the following is true?

• A) Smith will constantly attempt to increase the price of his product so he can increase his total revenue.
• B) Since the price of his product is dictated by the market, Smith will not have an incentive to control per-unit cost.
• C) Since the price of his product is dictated by the market, Smith has no production decisions to make.
• D) It would be senseless for Smith to try to increase sales by lowering the price of his product.

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Definitions:

Inherently Dangerous

Activities or items possessing potential for significant harm due to their nature.

Unreasonable Risk

A level of danger that exceeds what is considered acceptable or appropriate under given circumstances.

Negligent

Failing to take proper care in doing something, leading to damage or harm to others.

Offensive Bodily Contact

Unwanted physical interaction or touching that is considered harmful or offensive.