Firms in Perfectly Competitive Industries Are Unable to Control the Prices

question 248

Multiple Choice

Firms in perfectly competitive industries are unable to control the prices of the products they sell and earn a profit in the long run because

• A)Owners of perfectly competitive firms realise that their short-run profits are temporary.Therefore, they either sell their businesses or develop other products that will earn short-run profits.
• B)Firms in perfectly competitive industries can use advertising in the short run to persuade consumers that their products are better than those of other firms.But eventually consumers realise that all of the firms sell virtually identical products.
• C)Firms from other countries are able to produce similar products at lower costs.
• D)Firms in these industries sell identical products.

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Definitions:

Bill of Lading

A bill of lading is a legal document issued by a carrier to the shipper, detailing the type, quantity, and destination of the goods being transported.

SFC

Stands for Securities and Futures Commission, a regulatory agency overseeing securities and futures markets for integrity and protection against malpractice.

Nautical Navigation

The process and practice of charting a course for ships, boats, and other watercraft over bodies of water.

International Trade

The exchange of goods, services, and capital across international borders or territories.