The Term Caveat Emptor Means

question 15

Multiple Choice

The term caveat emptor means:

• A) The buyer must beware.
• B) The buyer must be protected.
• C) The buyer must be blamed.
• D) The buyer must be warned.

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Definitions:

Perfect Competition

A market structure where many firms sell identical products, entry and exit are easy, and no single buyer or seller can affect prices.

Marginal Cost (MC)

The increase in total cost that results from producing 1 more unit of output. Marginal costs reflect changes in variable costs.

Marginal Cost

The financial increment incurred by the production of an extra unit of a product or service.

Average Total Cost

It refers to the total cost per unit of output, calculated by dividing the total cost of production by the number of units produced.