In a Contestable Market

question 124

Multiple Choice

In a contestable market,

• A)An imperfectly competitive industry does not face any potential competition when profits increase.
• B)There are economies of scale that heighten competition.
• C)Barriers to entry and long-run economic profits are low.
• D)Many firms compete in producing a standardized product.

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Definitions:

Homogeneous Place

A location or setting where the individuals or elements share a high degree of similarity or uniformity.

Transportation Infrastructures

The foundational facilities and systems that support the movement of people and goods, including roads, bridges, tunnels, railways, and airports.

Safe Water

Water that is clean and free from contaminants, making it suitable for drinking and cooking without risking health.

Substantial Foreign Investment

Significant investment by individuals or companies from one country into business interests in another country.