In which way are contestable markets different from markets that are perfectly competitive? A. There is...
In which way are contestable markets different from markets that are perfectly competitive?
A. There is imperfect information—some firms have access to information while others do not.
B. Firms have a positive economic profit in the long run.
C. Firms charge a price that does not equal marginal cost.
D. There are a few firms in the industry.
E. This question makes no sense because there are no differences between contestable markets and markets that are perfectly competitive.
Homework Answers
Answer - Option D
There are few firms in the industry
As compared to perfect competition , lesser firms are there in contestable industry.
There is perfect information , only normal profits in long run and hence MR = MC. Thus Option D will only be the correct answer.
Add Answer to:
In which way are contestable markets different from markets that
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Part 1.
1. Use the figure above to answer this question.
Consider a perfectly competitive market experiencing good times.
Figure ________ shows a firm maximizing profit in the LONG RUN
because it produces ________ units and makes an economic profit of
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A) A; 100; $2 per unit
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Part 2.
2. The figure above shows a firm's demand and marginal
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1. Use the figure above to answer this question.
Consider a perfectly competitive market experiencing good times.
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because it produces ________ units and makes an economic profit of
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Part 2.
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