If firms in a perfectly competitive market produced dissimilar products:
A)the buyers in the market will be price takers.
B)price differentials will exist in equilibrium.
C)they will remain price takers.
D)price differentials between firms will be eliminated.

Question

Quizplus · Accepted Answer

In a perfectly competitive market, firms are price takers and cannot influence the market price. However, if firms produce dissimilar products, buyers will have a preference for one firm's product over another. This will create price differentials in equilibrium as buyers are willing to pay more for certain products based on their preferences. Therefore, option B is the correct answer.

If Firms in a Perfectly Competitive Market Produced Dissimilar Products