Perfect competition is a market structure
A) in which any firm would have serious impediments to entry or exit.
B) in which individual buyers and sellers have no effect on the market price.
C) resulting from individual firms selling highly differentiated products.
D) where there is significant regulation and markets are always efficient.
B
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Suppose the Ivory Coast, a small country, imports wheat at the world price of $4 per bushel. If the Ivory Coast imposes a tariff of $1 per bushel on imported wheat, then, other things equal, the price of wheat in Ivory Coast will increase, but by less than $1
a. True b. False Indicate whether the statement is true or false
A firm with market power faces the following estimated demand and average variable cost functions:Qd = 39,000 - 500P + 0.4M - 8,000PRAVC = 30 - 0.005Q + 0.0000005Q2where Qd is quantity demanded, P is price, M is income, and PR is the price of a related good. The firm expects income to be $40,000 and PR to be $2. Total fixed cost is $100,000. What price should the firm charge in order to maximize profit?
A. $50 B. $62 C. $70 D. $42.50 E. $48