In a Competitive Market,if Buyers Did Not Know All the Prices

question 56

Multiple Choice

In a competitive market,if buyers did not know all the prices charged by the many firms,

• A) all firms still face horizontal demand curves.
• B) firms sell a differentiated product.
• C) demand curves can be downward sloping for some or all firms.
• D) the number of firms will most likely decrease.

---

Definitions:

Price Index

A measure that examines the weighted average of prices of a basket of consumer goods and services over time.

Inflation Rate

The percentage rate at which the general level of prices for goods and services is rising annually.

CPI

Tracking the average evolution in pricing for a collection of goods and services purchased by people in urban areas, the Consumer Price Index serves as an indicator of these changes over time.

Consumer Price Index

The Consumer Price Index measures the average change over time in the prices paid by consumers for a basket of goods and services.