Asked by Rachel Tweedy on Jun 23, 2024
Verified
A purely competitive seller is
A) both a "price maker" and a "price taker."
B) neither a "price maker" nor a "price taker."
C) a "price taker."
D) a "price maker."
Price Taker
A market participant who has no influence over the market price and must accept the prevailing market price for its products or services.
Price Maker
An entity, typically a firm, with enough market power to influence or set the price of its product or service rather than taking the market price as given.
- Determine the traits and repercussions associated with being a price taker within an entirely competitive market environment.
Verified Answer
AC
Andrew CallawayJun 25, 2024
Final Answer :
C
Explanation :
In a purely competitive market, sellers have no control over the price of their product; they must accept the market price, making them "price takers."
Learning Objectives
- Determine the traits and repercussions associated with being a price taker within an entirely competitive market environment.