Which of the following is a characteristic of a competitive price-taker market?
A) Profit maximizing firms in the market will expand output until price equals average variable cost.
B) The market demand curve for the product is a horizontal line.
C) There are many firms in the market, each producing a small share of total market output.
D) The product produced by each of the firms is differentiated.

Question

Quizplus · Accepted Answer

In a competitive price-taker market, there are many firms, each producing a small share of the total market output, and the products are typically homogeneous, not differentiated.

Which of the Following Is a Characteristic of a Competitive