Which of the following is a reason why individual firms under pure competition would not find it gainful to advertise their product?
A) Firms produce a homogeneous product.
B) The quantity of the product demanded is very large.
C) The market demand curve cannot be increased.
D) Firms do not make long-run profits.

Question

Quizplus · Accepted Answer

In pure competition, firms produce a homogeneous product, meaning all products are identical and indistinguishable from one another. Therefore, advertising would not provide any competitive advantage or differentiation.

Which of the Following Is a Reason Why Individual Firms