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Basic Question 0 of 8
The term "price searcher" applies to all firms that ______
B. face a downward-sloping demand curve.
C. purchase resources in a non-competitive market.
A. operate in a purely competitive environment.
B. face a downward-sloping demand curve.
C. purchase resources in a non-competitive market.
User Contributed Comments 6
| User | Comment |
|---|---|
| JimM | A monopoly's demand curve is also downward sloping. |
| lpan | Price takers are firms in perfect competition and their demand curve perfectly elastic(horizontal) |
| dmfcrowe | Monopoly is also a price searcher, but differentiated by high entry barriers etc. |
| erinelize | I thought a Monopoly was a price-setter. That's what the notes said... |
| YOUCANDOIT | ^^^ b/c monopolies have incomplete information regarding market demand elasticity, it has to "experiment" with different output levels until it finds the profit-maximizing output and then it sets the price which corresponds to this quantity. So while a monopoly is a price-setter, it is also a price-searcher. |
| Creep | Key difference to be noted between price-searcher and price-taker. |
Your review questions and global ranking system were so helpful.
Lina
Learning Outcome Statements
explain the role of equity securities in the financing of a company's assets
contrast the market value and book value of equity securities
compare a company's cost of equity, its (accounting) return on equity, and investors' required rates of return
CFA® 2025 Level I Curriculum, Volume 3, Module 4.