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Questions
In which form of market is the seller a price taker? Justify your answer.
In which market form the firm is price taker?
"Under which type of a market are producers price takers"?
Solution
In a perfectly competitive market, the seller is a price taker.
Justification: In perfect competition, there are many sellers and purchasers in the market, and all firms sell identical (homogeneous) products. Because each firm's output is small in comparison to the entire market supply, no single seller has the ability to influence market price. Because all businesses sell the same commodities, no company can differentiate its product sufficiently to demand a higher price, requiring every seller to be a price taker.
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RELATED QUESTIONS
When products are differentiated on the basis of advertisements, brand names etc., it is called as ______.
Non-price competition is ______.
Indian Oil Corporation Limited is an example of a/an ______.
There is no difference between perfect competition and pure competition.
Match the following and select the correct option.
| Column I | Column II | ||
| (i) | Perfectly elastic demand | (A) | Oligopoly |
| (ii) | Less elastic demand | (B) | Monopolistic competition |
| (iii) | More elastic demand | (C) | Perfect competition |
| (iv) | Indeterminate demand | (D) | Monopoly |
Read the following statements carefully and choose the correct alternative:
Assertion (A): Price discrimination is possible under monopoly.
Reason (R): A monopolist can charge different prices in different markets because different sets of consumers - rich and poor - have different price elasticity of demand for the monopolist's product.
Give two characteristics of perfect competition.
What are selling costs?
State the advantage of monopolistic competition over monopoly.
Identify the market form of the following:
The Government of India is the sole buyer of fighter aircrafts.
Identify the market form of the following:
Goods sold are homogeneous.
Which type of market structure is the following? Give reason.
Lipstick
Which type of market structure is the following? Give reason.
Soft drinks
Product differentiation is practised in monopolistic competition? Give reasons.
Why can a monopolist charge different prices in different markets?
What do you mean by homogeneous products?
What is meant by the term 'price taker'?
What is the effect on price when a monopoly firm tries to sell more?
In what respects does oligopoly differ from monopoly?
What is a price making firm?
