Firms are "price makers" if they
A)have sufficient market power to set their product price.
B)make the market price their product price.
C)make their product price competitive.
D)None of the above

Question

Quizplus · Accepted Answer

Price makers are firms that have enough market power to set their own prices, rather than having to sell their products at the prevailing market price. This means that they can charge a higher price and earn higher profits. In contrast, firms that are price takers have to accept the prevailing market price for their product, and have little or no control over the price they can charge.

Firms Are "Price Makers" If They