Which of the Following Is a Characteristic of Perfect Competition

question 130

Multiple Choice

Which of the following is a characteristic of perfect competition?

• A)While there are many firms,relatively few tend to influence the market price.
• B)The firms that can distinguish its product from its competitors are the ones that usually succeed.
• C)Some barriers to entry into the market exist.
• D)In the buyers mind,the products are identical.

---

Definitions:

NPV

Net Present Value (NPV) is a financial metric that calculates the difference between the present value of cash inflows and the present value of cash outflows over a period of time, used in capital budgeting to assess the profitability of an investment.

Cost of Capital

The minimum profit percentage a corporation is required to generate from its investment initiatives to keep its market price stable and draw in financing.

Cash Flows

The total amount of money being transferred in and out of a business, especially affecting liquidity.

IRR

The Internal Rate of Return; a financial metric used to estimate the profitability of potential investments.