Which of the following is true of perfect competition?
A) Since a perfectly competitive firm can sell all it wants at the market price, the firm's demand curve is vertical at the market price over the entire range of output that it could possibly produce.
B) Because perfectly competitive markets have many buyers and sellers, each firm is so small in relation to the industry that its production decisions have no impact on the market price.
C) Since perfectly competitive markets are highly competitive, entering a market is very difficult.
D) Since there are large number of sellers in a perfectly competitive market, slightly differentiated products are considered identical.
E) Since all the products in a perfectly competitive market are identical, sellers can change the price of their product, but not the quantity supplied.
Correct Answer:
Verified
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