Which of the following is the best example of a business firm operating in a competitive price-taker market?
A) TGIFriday's, a restaurant chain that operates in numerous locations
B) a bookstore located a few blocks from a major university
C) Ford Motor company, a major manufacturer of automobiles that operates in numerous markets throughout the world
D) an Indiana hog farmer that raises pigs

Question

Quizplus · Accepted Answer

A hog farmer operating in Indiana is the best example of a business firm operating in a competitive price-taker market as they have no control over the price of hogs in the market and have to accept market prices for their products. TGIFriday's, a restaurant chain operating in numerous locations, has some degree of pricing power by differentiating themselves through their menu and atmosphere. A bookstore located a few blocks from a major university may also have some pricing power by stocking unique and in-demand books. Similarly, Ford Motor company, a major automobile manufacturer, has some pricing power through product differentiation and brand recognition.

Which of the Following Is the Best Example of a Business