Advertisements
Advertisements
Question
What is a price taker firm?
Solution
A firm which does not have any control over the prevailing market price is known as a price taker firm. In this situation, the price is determined by the market and the firm must accept the prevailing market price to sell the goods.
RELATED QUESTIONS
Explain ‘large number of buyers and sellers' features of a perfectly competitive market.
Explain the implications of the following : Perfect knowledge in perfect competition.
Explain Perfect knowledge about the markets feature of perfect competition.
Under what market condition does Average Revenue always equal Marginal Revenue? Explain.
Why can a firm not earn abnormal profits under perfect competition in the long run? Explain.
Explain the implication of ‘freedom of entry and exit to the firms’ under perfect competition.
In which market form can a firm not influence the price of the product?
Explain how price is determined in a perfectly competitive market with fixed number of firms.
What are the characteristics of a perfectly competitive market?
How is the optimal amount of labour determined in a perfectly competitive market?
Show with the help of a diagram, how a perfectly competitive firm earns a normal profit in short-run equilibrium.
Under Perfect Competition, a firm will enjoy normal profit in the long run even if it enjoys supernormal profit in the short run. Explain.
How is Total Revenue under perfect competition different from Total Revenue under imperfect competition? Give two points to show the difference.
A perfectly competitive firm always enjoys normal profit in the long run, irrespective of the situation it faces in the short run. Discuss the statement in brief.
A car company ‘W’ hired an international cricket player for its endorsement in India, while two other car companies’ ‘Y’ and ‘R’ hired two famous Bollywood film stars for this purpose. Explain the features of the competitive market indicated above.
