The broccoli market is perfectly competitive.This means that the price of broccoli is _____ than if the market were monopolistically competitive,and total broccoli output in the market is _____ than if it were monopolistically competitive.
A)lower;higher
B)lower;lower
C)higher;lower
D)higher;higher

Question

Quizplus · Accepted Answer

In a perfectly competitive market, firms are price takers due to the high level of competition, leading to lower prices compared to a monopolistically competitive market where firms have some power to set prices above marginal costs. Additionally, the total output in a perfectly competitive market is higher because firms produce at the point where price equals marginal cost, leading to an efficient allocation of resources and maximizing total output.

The Broccoli Market Is Perfectly Competitive