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What characteristic of a perfectly competitive firm that causes it to be a price taker?
A perfectly competitive firm is a price taker because it operates in a market with many buyers and sellers, where no single firm can influence the market price due to the homogeneity of the products offered. Additionally, the presence of perfect information allows consumers to easily compare prices, leading firms to accept the market price determined by supply and demand. Since firms in this market structure produce identical products, they must sell at the prevailing market price to remain competitive, as charging a higher price would result in losing customers to competitors.
What else can I help you with?
Can a perfectly competitive firm set a price for its products that is above marginal cost?
A perfectly competitive firm would set its prices at a perfectly competitive price.
Is marginal revenue equal to price in a perfectly competitive market?
In a perfectly competitive market, marginal revenue is equal to price.
Is the price equal to marginal revenue in a perfectly competitive market?
In a perfectly competitive market, the price is equal to the marginal revenue.
Does marginal revenue equal price in a perfectly competitive market?
Yes, in a perfectly competitive market, marginal revenue equals price.
Does a perfectly competitive market demonstrate the need for subsidies and price ceilings?
no
Can a perfectly competitive firm set a price for its products that is above marginal cost?
A perfectly competitive firm would set its prices at a perfectly competitive price.
Is marginal revenue equal to price in a perfectly competitive market?
In a perfectly competitive market, marginal revenue is equal to price.
Is the price equal to marginal revenue in a perfectly competitive market?
In a perfectly competitive market, the price is equal to the marginal revenue.
Does marginal revenue equal price in a perfectly competitive market?
Yes, in a perfectly competitive market, marginal revenue equals price.
Does a perfectly competitive market demonstrate the need for subsidies and price ceilings?
no
Is it true that in a perfectly competitive market, the marginal revenue is equal to the price of the good for each unit sold?
Yes, in a perfectly competitive market, the marginal revenue is equal to the price of the good for each unit sold.
What will happen if an individual perfectly competitive firm charges a price above the industry equilibrium price?
If an individual in a perfectly competitive firm charges a price above the industry equilibrium price this is bad. This company will go out of business quickly because their customers will go find the lower price.
Why is a perfectly competitive firm considered a price taker?
A perfectly competitive firm is considered a price taker because it has no control over the price of the goods or services it sells. In a perfectly competitive market, there are many buyers and sellers, and each firm's output is a small fraction of the total market supply, so individual firms must accept the market price set by supply and demand forces.
In a perfectly competitive market individual consumers have .?
no influence over determining price
In a perfectly competitive market, individual consumers have _____.?
no influence over determining price
When should a perfectly competitive firm should expand output?
when price>marginal cost
What is the demand curve for output of a perfectly competitive firm?
Demand = Price = Marginal Cost.
