The Presence of a Relatively Large Number of Firms in an Industry

question 28

Multiple Choice

The presence of a relatively large number of firms in an industry does not ensure perfect competition if:

• A)they sell products that are standardized.
• B)there are also a large number of consumers.
• C)they collude to set prices in the market.
• D)the industry is an increasing-cost industry.

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Definitions:

Total Share

Refers to the total number of shares of stock that are owned by shareholders, including both public investors and private insiders or executives.

Net Income

The net income of a business following the subtraction of all costs and taxes from its gross earnings.

Income Distribution

The allocation of a company's net income among shareholders in the form of dividends and retained earnings within the company.

Capital Balance

Represents the amount of capital contributed by investors or owners, plus retained earnings minus any distributions or withdrawals.