Which of the Following Is Not a Characteristic of a Perfectly

question 25

Multiple Choice

Which of the following is not a characteristic of a perfectly competitive market structure?

• A) There is a very large number of firms that are small compared to the market.
• B) All firms sell identical products.
• C) There are no restrictions to entry by new firms.
• D) There are restrictions on exit of firms.

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Definitions:

Scenario Analysis

A method used in finance to analyze the different possible outcomes of a decision given varying sets of assumptions.

Sensitivity Analysis

A financial modeling tool used to determine how different values of an independent variable will impact a particular dependent variable under a given set of assumptions.

Decision Tree Analysis

A graphical technique used for decision-making and risk management, representing different courses of action and their possible outcomes.

Cost Of Capital

The cost of capital represents the required return necessary to make a capital budgeting project, such as building a new factory, worthwhile.