Questions and Answers
In a perfectly competitive market, how do individual firms influence the market price?
By accepting the market price as given
Which factor determines the quantity of a good or service that consumers are willing and able to buy at a given price?
Demand
What happens to the equilibrium price and quantity in a market if there is an increase in demand and no change in supply?
Equilibrium price and quantity both increase
In a perfectly competitive market, what is the characteristic of the products sold by different firms?
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Which form of market competition is characterized by a small number of large firms dominating the market and having the ability to influence prices?
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What effect does an increase in supply have on the equilibrium price and quantity in a market?
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