Which of the following is a reason to study the decisions of price takers?
A) While there are not many price-taker markets, these few markets dominate the economy.
B) The decision making of both price searchers and price takers is identical.
C) The price-taker model enhances our knowledge of competition as a dynamic process.
D) Price takers are the most common type of business in the real world.

Question

Quizplus · Accepted Answer

Studying price takers helps understand competition as a dynamic process because it illustrates how firms operate in perfectly competitive markets where they have no control over prices.

Which of the Following Is a Reason to Study the Decisions