QuestionJuly 30, 2025

The perfectly competitive firm cannot influence the market price because it has market power. its production is too small to affect the market. it is a price maker. Laws do not permit them.

The perfectly competitive firm cannot influence the market price because it has market power. its production is too small to affect the market. it is a price maker. Laws do not permit them.
The perfectly competitive firm cannot influence the market price
because
it has market power.
its production is too small to affect the market.
it is a price maker.
Laws do not permit them.

Solution
4.5(300 votes)

Answer

its production is too small to affect the market. Explanation 1. Identify the characteristic of a perfectly competitive firm A perfectly competitive firm is a price taker, meaning it cannot influence the market price. 2. Determine why it cannot influence the market price The firm's production is too small to affect the overall market supply and demand, thus it cannot influence the market price.

Explanation

1. Identify the characteristic of a perfectly competitive firm<br /> A perfectly competitive firm is a price taker, meaning it cannot influence the market price.<br /><br />2. Determine why it cannot influence the market price<br /> The firm's production is too small to affect the overall market supply and demand, thus it cannot influence the market price.
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