Which of the following best describes firms in perfectly competitive markets?

Question

Quizplus · Accepted Answer

Firms in perfectly competitive markets are price takers, meaning they have no control over the market price of the good they produce. They must accept the prevailing market price and adjust their output accordingly. Choice A is incorrect because firms in perfectly competitive markets do not have the ability to vary the quality of output because they must produce a standardized product. Choice B is incorrect because price makers have control over the market price, which is not the case for firms in perfectly competitive markets. Choice D is incorrect because firms in perfectly competitive markets sell homogeneous products, not heterogeneous ones.

Which of the Following Best Describes Firms in Perfectly Competitive