Why do economists assume that firms are price-takers in the model of perfect competition? How does this

Question:

Why do economists assume that firms are price-takers in the model of perfect competition? How does this pricing behavior differ from that in the other market models?

Fantastic news! We've Found the answer you've been seeking!

Step by Step Answer:

Related Book For book-img-for-question

Economics for Managers

ISBN: 978-0132773706

3rd edition

Authors: Paul G. Farnham

See More Books

Question Posted: Dec 15, 2015 06:36 AM

See More Questions

Most economists assume that firms always act to maximize profit. What does the theory of asymmetric information have to say about that?
Economists assume that firms have a goal to maximize profits. Is this a reasonable assumption for not-for-profit organizations?
Review the concept of externalities from Chapter 5, page 148. If a market is a monopoly, will a negative externality in production always lead to production beyond the level of economic efficiency?...
Explain the relationship between three Statement objects, and illustrate why and how the CallableStatement object can use the setXXX() methods defined in the PreparedStatement interface.
List three ways you intend to provide superior customer service.
What is the tax marriage penalty and when does it apply? Under what circumstances would a couple experience a tax marriage benefit?
The two wires are connected together at A. If the force P causes point A to be displaced horizontally 2 mm, determine the normal strain developed in each wire. C 300 mm 30 B 300 mm 30 A -P
The treasury stock purchased in question 13 is resold by Chen, Inc. for $15,000. What effect does this transaction have on (a) Net income, (b) Total assets, (c) Total paid-in capital, and (d) Total...
[7/10 pts] Analyze the below nested for loops and find its time complexity function T(n) for (i = 1; i
CableTech Bell Corporation (CTB) operates in the telecommunications industry. CTB has two divisions: the Phone Division and the Cable Service Division. The Phone Division manufactures telephones in...
What are the four major types of markets in micro-economic analysis? What are the key characteristics that distinguish these markets?
In macroeconomics, what are the five major categories of spending that make up GDP? Are all five categories added together to determine GDP? Discuss the differences between fiscal and monetary...
Explain why the form and report in Figure 5-15 indicate that the underlying relationship is 1:1.
State the most innovative solutions about 23 and me (up to two) What can be learnt from 23 and me What can be learnt from HSAD 390 and how it can be used personally
Is effective communication among associates and firms a better tool than unions?
What are the worst cover letter mistakes that you can think of? Name 6 and explain why
What guidance can you find in the CECE Code of Ethics and Standards of Practice? Review the practice sections for each standard and the code of ethics.
Answer the following questions about Good and Neutral News Messages: a. What approach do you use to delivery good and neutral news? Inductive or Deductive? b. A college has announced the "Jeans for...
In Exercises 1317, find the x-intercepts of the graph of each equation. y = x 5x + 8
Find i 0 (t) for t > 0 in the circuit in Fig. 16.72 . 2 + Vo 1 7.5e-2t u(t) V ( +) 4.5[1 u(t)]V 0.5v. 1H
You are in the market for a new refrigerator for your companys lounge, and you have narrowed the search down to two models. The energy efficient model sells for $500 and will save you $25 at the end...
You are the human resources manager for a famous retailer, and you are trying to convince the president of the company to change the structure of employee compensation. Currently, the companys retail...
Tara is considering leaving her current job, which pays $56,000 per year, to start a new company that manufactures a line of special pens for personal digital assistants. Based on market research,...
Discuss the cultural differences between China and the United States. What would be the biggest adjustments I might need to make if working there as an expatriate? What are the most...
In her Ted talk, Kristi Rogers talks about the future of advertising and why it's crucial for ads to be relevant. She points out that even though we have lots of data and technology for digital ads,...
Consider ways in which an employer can make an employee feel like part of the team and/or empower them to act. More specifically, please respond to the following questions: How can an employer work...

Why do economists assume that firms are price-takers in the model of perfect competition? How does this

Question:

Step by Step Answer:

In the model of perfect competition firms are pricetak...View the full answer

Economics for Managers

Students also viewed these Economics questions