Which of the Following Statements Is True

question 42

Multiple Choice

Which of the following statements is true?

• A) The higher the market concentration, the lower the price in the market.
• B) An increase in market concentration will lead to an increase in prices and profits.
• C) A decrease in market concentration will lead to a decrease in efficiency.
• D) Market concentration and profits are independent of each other.
• E) The larger the concentration ratio, the higher the number of firms in the market.

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Definitions:

Per Unit

A term used to express the cost, price, or quantity concerning a single unit of a product or service.

Tax Burden

The measurement of taxes paid by an individual or business, expressed as a percentage of income or profit.

Sellers

Individuals or entities that offer goods or services in exchange for monetary compensation or other forms of payment.

Per Unit

Refers to expressing a variable or a measure on a per single item basis.