When Firms in a Competitive Market Have Different Costs, It

question 63

Multiple Choice

When firms in a competitive market have different costs, it is likely that

• A)free entry and exit in the market will be violated.
• B)the market will no longer be considered competitive.
• C)long-run market supply will be downward sloping.
• D)some firms will earn positive economic profits in the long run.

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Definitions:

Stockholders' Equity

The residual interest in the assets of a corporation remaining after deducting its liabilities, representing the ownership interest of the shareholders.

Dividend Yield

Dividend Yield is a financial ratio that shows how much a company pays out in dividends each year relative to its stock price, indicating the return on investment from dividends alone.

Cash Dividends Per Share

The amount of cash distributed to shareholders per share out of a company's earnings.

Market Price

The market value at which you can currently buy or sell an asset or service.