The Theory of Contestable Markets Concludes That

Multiple Choice

The theory of contestable markets concludes that

A) a small number of firms in an industry is strong evidence that they will perform in a noncompetitive way.
B) even if the number of sellers in an industry is small, profits can be zero in the industry.
C) inefficient producers can survive in a contestable market.
D) a firm in a contestable market will sell at a price above marginal cost.