Which of the Following Is True of a Competitive Market

question 53

Multiple Choice

Which of the following is true of a competitive market?

• A) The outcome of a competitive market is fair and equitable.
• B) Competitive markets yield efficient outcomes.
• C) Competitive markets allow consumers to gain at the expense of producers.
• D) Competitive markets provide significant economic profits to producers in the long run.
• E) Competitive markets promote business by allowing producers to gain at the expense of consumers.

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Definitions:

Imitation

The act of copying or mimicking the features, designs, or actions of another product, service, or behavior, often with the intention of capturing value or recognition.

Technological Advances

Improvements in technology, which typically lead to more efficient production processes, new products, or improved ways to perform tasks.

Diffusion

The process through which new ideas, products, or practices spread within a population or society.

Expected Rate of Return

The anticipated amount of profit or loss an investment is likely to generate, typically expressed as a percentage of the investment's initial cost.