For Firms That Sell One Product in a Perfectly Competitive

question 45

Multiple Choice

For firms that sell one product in a perfectly competitive market,the market price:

• A) will remain constant regardless of an individual firm's output decision.
• B) is equal to the average total cost of a firm.
• C) is equal to the marginal cost of a firm.
• D) All of these are true.

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Definitions:

Consignee

The individual or entity to whom goods are shipped and who is responsible for receiving the shipment and completing any customs paperwork.

Ending Inventory

The value of goods that remain unsold at the end of an accounting period.

Cost Flow Assumption

An accounting method used to value inventory and determine the cost of goods sold, such as FIFO (First In, First Out) or LIFO (Last In, First Out).

LIFO

"Last In, First Out" method of inventory valuation where the most recently produced items are recorded as sold first.