Perfect Competition

question 19

Multiple Choice

Perfect competition

• A) ensures that the goods sold to consumers will be produced at the lowest possible cost
• B) leads to the efficient organization of production
• C) Both answers are correct

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Definitions:

Contract Rate

It is the interest rate stated in a contract, such as a loan or lease agreement.

Non-interest-bearing Notes

Debt instruments that do not accrue interest over time, thus repaid at their face value.

Incremental Borrowing Rate

The interest rate a lessee would have to pay to borrow over a similar term the funds necessary to purchase or lease an asset.