How Are a Wheat Farmer and a Firm Similar in a Perfectly

question 224

Multiple Choice

How are a wheat farmer and a firm similar in a perfectly competitive market?

• A)Both face vertical demand curves.
• B)Both have to lower their prices if a rival firm lowers its price.
• C)Both face horizontal demand curves.
• D)Both will earn an economic profit if their total revenue equals their total cost.

Perform information triage in evaluating conversations.

Understand the importance of social decentering in effective communication.

Differentiate between facts and inferences in communication.

Avoid generalizations in cross-cultural communication and practice cultural sensitivity.

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Definitions:

Variable Cost

Expenses that vary in relation to the amount of products or services a company generates.

Fixed Cost

Costs that do not change with the level of production or sales, such as rent, salaries, and loan repayments.

Economies of Scale

The cost advantages that a business can exploit by expanding their scale of production, leading to a lower cost per unit.

Diseconomies of Scale

Increased costs per unit that occur when a company grows too large, leading to inefficiencies.