Which of the Following Is Characteristic of a Perfectly Competitive

question 56

Multiple Choice

Which of the following is characteristic of a perfectly competitive market?

• A) There is free entry into and exit from the market.
• B) Individual firms can exert a perceptible influence on the market price.
• C) Firms in the market produce a differentiated product.
• D) All of the above are true.

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Definitions:

Utility

An indicator of pleasure or contentment obtained from the acquisition and use of products and services.

Utils

A theoretical unit of measurement used in economics to quantify the amount of utility or satisfaction derived from consuming goods and services.

Indifference Curves

Graphical representations in economics, illustrating different combinations of goods or services among which a consumer is indifferent.

Ordinary Goods

Goods for which demand increases as consumer income increases and decreases as consumer income decreases, opposite to inferior goods.