If a perfectly competitive firm raises its price, its sales decrease to zero.

Name: If a perfectly competitive firm raises its price, its sales decrease to zero.
Brand: Quizplus
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Question

Quizplus · Accepted Answer

In a perfectly competitive market, firms are price takers, meaning they must accept the market price. If a firm raises its price above the market level, consumers will buy from other firms, leading to zero sales for the firm that increased its price.

If a Perfectly Competitive Firm Raises Its Price, Its Sales