Consumers Do Not Have a Strong Preference for the Output

question 65

Multiple Choice

Consumers do not have a strong preference for the output of one seller over that of another in a perfectly competitive market because

• A) there a large number of firms in the market.
• B) the firms sell a standardized product.
• C) there are no barriers to entry.
• D) an individual firm has control over price.

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Definitions:

Consumption

The use of goods and services by households or individuals, often considered in terms of the total amount consumed in an economy.

Allocation of Resources

The process of distributing available resources among various uses to satisfy the needs and wants of the society.

Taxes

Financial charges imposed by a government on individuals, businesses, or other entities to fund public spending and various services.

Prices

The monetary value assigned to goods and services in a market, determining the exchange rate in transactions.