Final answer:
Individual firms in a perfectly competitive market are price takers and cannot raise prices without losing sales, as prices are determined by market supply and demand. Whether independent trucking is perfectly competitive depends on several factors. An increase in market price would generally lead to higher profits for firms.
Step-by-step explanation:
In a perfectly competitive market, firms are known as price takers. This is due to the fact that individual firms have no power to influence the market price which is determined by the overall supply and demand in the market. If a firm were to raise the price of its product even by a small amount, consumers would simply purchase from competitors, leading the firm to lose all of its sales. As price takers, individual firms must accept the equilibrium price and cannot change it to reflect their own costs or desired profits.
Regarding independent trucking, whether it fits the characteristics of a perfectly competitive industry depends on several factors such as market entry and exit freedom, product homogeneity, and whether a single firm can influence the price. Without additional context, this cannot be conclusively answered.
If the market price increases, as illustrated in a hypothetical Table 8.13, this would generally lead to an increase in profits for the firm selling the product. The exact change in profits would depend on the cost structure detailed in the table.