In perfect competition, if one firm raises its price, others will followthat firm will increase its revenuesthat firm will lose revenues because other firms will not followall consumers will be adversely affected

In perfect competition, if one firm raises its price, others will followthat firm will increase its revenuesthat firm will lose revenues because other firms will not followall consumers will be adversely affected

Microeconomics

13th Edition

ISBN:9781337617406

Author:Roger A. Arnold

Publisher:Roger A. Arnold

Chapter9: Perfect Competition

Section: Chapter Questions

Problem 8QP

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Equilibrium Price and Quantity

Equilibrium refers to a state of balance that comes about because there is equality in all forces.

Question

Definition Definition Structure of the market that exists when many buyers and sellers exchange similar commodities and prices are fixed by market forces, demand, and supply. When there is perfect competition, a single business cannot impact the price or market value of the homogenous product.

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