Question

Firm in industry is 'price taker'. This is feature of ________.

• A. perfect competition
• B. monopoly
• C. monopolistic competition
• D. (B) and (C)

Answer 1

Answer: (A)

perfect competition

Perfect competition is a type of market where there are huge number of buyers and sellers who deals in the same type of product due to which no individual unit is able to influence the price of the product.

And the firm have to quote the price that prevails in the market. Therefore, they are the price taker.