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FICA: The abbreviation for Federal Insurance Contributions Act, passed in 1939, which established payroll deductions from wage-earning employees and the employers for the Social Security system. This is the noted Social Security tax that wage earners pay and which is then used to provide Social Security benefits to the elderly, disable, and qualified dependents.
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                           PRICE TAKER: A buyer or seller that has no market control and is not able to affect the price of a good. It must "take" or accept the going market price. The market structure that exemplifies price taker is perfect competition. In fact, perfect competition is the only example of price taker. This is one of two alternatives related to control over price. The other is price maker. Price taker is also termed price seeker. The lack of market control is what creates a price taker. A buyer or seller that has NO market control must accept the existing market price when buying or selling a good. It has no choice. Pay the going price and buy the good. Do not pay the going price and do not buy the good. Accept the going price and sell the good. Do not accept the going price and do not sell the good. For a price taker, no other options exist.Perfect competition is THE example for pricer taker because it contains a relatively large number of participants that trade an identical product. Participants are free to enter and exit the market and everyone has complete knowledge of all prices. Each buyer competes against thousands, hundreds of thousands, or even millions of other buyers when they seek to purchase a good. Each seller competes against thousands, hundreds of thousands, or even millions of other sellers when they seek to sell a good. Sellers do not sell to a buyer trying to pay less than going market price, because thousands, or even millions of other buyers are willing and able to pay the going price. Buyers do not buy from a seller trying to charge more than going market price, because thousands, or even millions of other sellers are willing and able to charge the going price. Each participant is an insignificant part of the overall market. Should a given buyer decide to buy more or less or nothing at all, the market is unaffected. Should a given seller decide to sell more or less or nothing at all, the market is unaffected. Price-taking buyers and sellers face perfectly elastic demand and supply curves. For example, a perfectly competitive seller faces a perfectly elastic demand curve, one that is horizontal at the market price. It can sell any quantity that it wants at the going market price. A perfectly competitive buyer faces a perfectly elastic supply curve, one that is horizontal at the market price. It can buy any quantity that it wants at the going market price. Facing a constant market price and perfectly elastic demand or supply curve means that price takers efficiently allocate resources. The value of goods produced is equal to the value of goods not produced.
 Recommended Citation:PRICE TAKER, AmosWEB Encyclonomic WEB*pedia, http://www.AmosWEB.com, AmosWEB LLC, 2000-2023. [Accessed: November 30, 2023]. Check Out These Related Terms... | | | | | | | | | | | | Or For A Little Background... | | | | | | | | | | | | And For Further Study... | | | | | | | | | | | |
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PINK FADFLY [What's This?]
Today, you are likely to spend a great deal of time strolling through a department store hoping to buy either a coffee cup commemorating the 2000 Olympics or a birthday gift for your grandmother. Be on the lookout for neighborhood pets, especially belligerent parrots. Your Complete Scope
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Helping spur the U.S. industrial revolution, Thomas Edison patented nearly 1300 inventions, 300 of which came out of his Menlo Park "invention factory" during a four-year period.
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"Consult not your fears, but your hopes and your dreams. Think not about your frustrations, but about your unfulfilled potential. Concern yourself not with what you tried and failed in, but with what it is still possible for you to do. " -- Pope John XXIII
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IIPF International Institute of Public Finance
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