ECONOMICS
MARKET FAILURES
|
Question
[CLICK ON ANY CHOICE TO KNOW THE RIGHT ANSWER]
|
|
|
many sellers participate in the market.
|
|
|
Sellers offer identical products.
|
|
|
buyers and sellers are well informed about products
|
|
|
sellers are able to enter and exit the market easily.
|
Detailed explanation-1: -Several corn farmers in Iowa meet with their friends each week for breakfast. They talk about their families and about the weather. But soon they engage in more serious discussions about the future demand for corn, the latest prices being offered for their crop, and the cost of their seeds, fertilizer, and machinery.
Detailed explanation-2: -Corn farm is classified as an oligopoly market because the agricultural industry has a small number of sellers.
Detailed explanation-3: -Why is the market for corn closer to perfect competition than the market for corn flakes? that have few sellers or products that are not standardized. Wholesale markets for agricultural products, such as corn, come close to perfect competition.
Detailed explanation-4: -Which factor explains why firms within monopolistically competitive markets have limited control over prices? Each firm produces a differentiated product.