Suppose Thelma and Louise both sell fried green tomatoes in a competitive price-taker market. If Louise increases her output,
A) Thelma must reduce output
B) the price Thelma can charge falls
C) the price Thelma can charge rises
D) the price Thelma can charge is unaffected
E) Thelma's profits must fall

Question

Quizplus · Accepted Answer

In a competitive price-taker market, individual sellers cannot influence the market price. Therefore, if Louise increases her output, it does not affect the price Thelma can charge.

Suppose Thelma and Louise Both Sell Fried Green Tomatoes in a Competitive