Question

When studying a certain market, I notice that sellers change their prices uniformly, i.e. at about the same time they all either choose to raise or lower prices Select one: a.d. This is evidence that competition has increased in the industry. b. b. This is evidence of competition, since the sellers will all make the same type of adjustment to a change in the environment (e.g. a nationwide rise in fuel prices) Uniform price changes can be seen in both markets where producers act noncompetitively and in markets where they actively compete. d. a This is evidence of a collusion to fix prices. C C

Answer 1

Ans. Option b

This is because in a competitive market price is decided at the market level and then each individual firm takes the price as given, so, any change in price in the market will change the price of individual firms by same amount.

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