Which of the Following Is a Characteristic of a Competitive

question 523

Multiple Choice

Which of the following is a characteristic of a competitive market?

• A)There are many buyers but few sellers.
• B)Firms sell differentiated products.
• C)There are many barriers to entry.
• D)Buyers and sellers are price takers.

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Definitions:

Purchasing Power Parity

A theory which states that exchange rates between currencies are in equilibrium when their purchasing power is the same in each of the two countries.

Exchange Rate

The price of one country's currency in terms of another currency, determining how much foreign currency can be exchanged for a unit of domestic currency.

Spot Trade

A transaction for the immediate delivery of a financial instrument or commodity.