Which of the following statements correctly describes a competitive market?

Question

Quizplus · Accepted Answer

A competitive market is one where there are many buyers and sellers, and no single buyer or seller has the power to influence the market price. Instead, the market price is determined by the interaction of demand and supply. Option A is incorrect because in a competitive market, prices are determined by supply and demand and not through negotiation. Option B is incorrect because in a competitive market, prices for the same good are the same across all sellers. Option C is incorrect because having a single seller with the ability to control prices is a characteristic of a monopoly market, not a competitive market.

Which of the Following Statements Correctly Describes a Competitive Market