A market is said to be perfectly-competitive when:the market may be dominated by one or two major companies, but there aremany smaller companies also in the market.there are any number of products, equivalent buying and selling prices, andindividual buyers or sellers can affect those prices by their own actions.there is a homogeneous product, equivalent buying and selling prices, and noindividual buyers or sellers can affect those prices by their own actions.there is no opportunity costs incurred by the vendor nor by the buyer.there are any number of products, equivalent buying and selling prices, andindividual buyers or sellers can affect those prices by their own actions, butthere are no opportunity costs for buyers or sellers. Soft Cushion Company is highly decentralized. Each division is empowered to make its own sales decisions. TheAssembly Division can purchase cushion stuffing from the Production Division or from external suppliers. TheProduction Division has been the major supplier of stuffing in recent years. The Assembly Division has announcedthat two external suppliers will be used to purchase the stuffing at $20 per kilogram for the next year. The ProductionDivision recently increased its unit price to $40. The manager of the Production Division presented the followinginformation; variable cost $32, fixed cost $8, to top management in order to attempt to force the Assembly Division topurchase the stuffing internally. The Assembly Division purchases 20,000 kg per month.What is the monthly operating advantage (disadvantage) of purchasing the goods internally assuming the ProductionDivision is able to utilize the facilities for other operations resulting in monthly cash-operating savings of $40,000?$280,000$(360,000)$440,000$40,000$(280,000)

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A market is said to be perfectly-competitive when: the market may be dominated by one or two major companies, but there are many smaller companies also in the market. there are any number of products, equivalent buying and selling prices, and individual buyers or sellers can affect those prices by their own actions. there is a homogeneous product, equivalent buying and selling prices, and no individual buyers or sellers can affect those prices by their own actions. there is no opportunity costs incurred by the vendor nor by the buyer. there are any number of products, equivalent buying and selling prices, and individual buyers or sellers can affect those prices by their own actions, but there are no opportunity costs for buyers or sellers.

A market is said to be perfectly-competitive when: the market may be dominated by one or two major companies, but there are many smaller companies also in the market. there are any number of products, equivalent buying and selling prices, and individual buyers or sellers can affect those prices by their own actions. there is a homogeneous product, equivalent buying and selling prices, and no individual buyers or sellers can affect those prices by their own actions. there is no opportunity costs incurred by the vendor nor by the buyer. there are any number of products, equivalent buying and selling prices, and individual buyers or sellers can affect those prices by their own actions, but there are no opportunity costs for buyers or sellers.

Economics (MindTap Course List)

13th Edition

ISBN:9781337617383

Author:Roger A. Arnold

Publisher:Roger A. Arnold

Chapter22: Perfect Competition

Section: Chapter Questions

Problem 4QP

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