A price-maker is a firm that ________.
A) has the power to affect the price of the product it sells
B) earns economic profits in both the short run and the long run
C) can sell any quantity of its product at the prevailing market price
D) sells its products at a price equal to the marginal cost of production

Question

Quizplus · Accepted Answer

A price-maker is a firm that has the power to affect the price of the product it sells. This means that the firm can set a higher price and still sell its products, earning higher profit margins. The other options do not provide a suitable definition of a price-maker.

A Price-Maker Is a Firm That ________