" It makes no sense for the managers of a perfectly competitive firm to spend money...
" It makes no sense for the managers of a perfectly competitive firm to spend money on advertising". Which of the following statements would help you explain this statement, if you think it is true?
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The statement is not true. Promotion and advertising exists to drive sales up. |
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The products are identical and market participants have perfect information about the price |
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Buyers not all have the same information and therefore, advertising is useful to "educate" buyers. |
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the products are different |
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Buyers and sellers have perfect information about the product and its price |
Homework Answers
The products are identical and market participants have perfect information about the price
Explanation: All firms sell an identical product in perfect competition. So, advertising is meaningless in perfect competition.
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" It makes no sense for the managers of a perfectly
competitive firm to spend money...
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Is this correct :) Compare monopoly and perfectly competitive firm on the following points. Perfectly Competitive...
Is this correct :)
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Is this correct :)
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