Ask Question, Ask an Expert


Ask Business Economics Expert

Multiple choice problems on Perfect competition

1) Which of the subsequent is not necessarily a characteristic of perfect competition?

a) low prices
b) a large number of buyers and sellers
c) a homogeneous product
d) perfect information

2) In the short run, a perfectly competitive ball bearing manufacturer will continue to capable to produce at a loss if

a) It is covering all of its fixed cost

b) it is covering all of its variable cost plus part of its fixed cost

c) Variable cost is less than fixed cost

d) Fixed cost is zero

3) The golden rule of profit maximization states which any company maximizes profit by producing where marginal revenue equals marginal cost

a) Demand is unit elastic, and total revenue is greatest

b) Price equals marginal revenue

c) Price equals marginal cost

4) Which of the characteristics of perfect competition assures which economic profit will be zero in the long run?

a)   There is easy entry and exit in the market.

b)   Each company is a price taker.

c)  Each company has access to perfect information.

d) Each company is small relative to the market.

 5) A constant-cost company is distinguished by the fact which

a) Companies' short-run average total costs are horizontal

b) Companies' short-run marginal cost curves are horizontal

c) The long-run company supply curve is perfectly elastic

d) The short-run company supply curve is perfectly elastic

6) Commodity products are

a) Pasteurized

b) bland

c) perceived by consumers to be identical

d) made by one manufacturer

7) In a perfectly competitive company we are likely to find

a)  Companies producing a wide variety of products

b)  Barriers to entry

c)  No profit possible in the short run

d)  Companies which do not advertise

8) Perfectly competitive companies are price takers because

a)  all small companies must take the price set by the largest company in the market

b)  companies take the price which government determines is a "fair" price

c)  each company is small and goods are perfect substitutes for one another

d)  free entry and exit in the short run creates a constant market price in the long run

9) In perfect competition, if one company raises its price,

a) others will follow

b) which company will increase its revenues

c) which company will lose revenues because other companies will not follow

d) all consumers will be adversely affected

10) Suppose, at its present rate of output, a perfectly competitive company's marginal revenue exceeds both its marginal cost and its average variable cost. To maximize profit, the company should

a) lower the price

b) raise the price

c) increase output

d) reduce output

Business Economics, Economics

  • Category:- Business Economics
  • Reference No.:- M917000

Have any Question? 

Related Questions in Business Economics

A producer of ballpoint pens has been purchasing ink from

A producer of ballpoint pens has been purchasing ink from an ink supplier and is considering acquiring the ink supplier. Would the pen company be more or less likely to vertically integrate by buying the ink manufacturer ...

The abner corporation a retail seller of television sets

The Abner Corporation, a retail seller of television sets, wants to determine how many television sets it must sell to earn a pro t of $10,000 per month. The price of each television set is $300, and the average variable ...

Calculating and using ratios 1 if we divide users of ratios

Calculating and Using Ratios 1. If we divide users of ratios into short-term lenders, long-term lenders, and stockholders, which ratios would each group be most interested in, and for what reasons? 2. Bud’s Big Time Bowl ...

1 nicole earned a salary of 50000 in 2015 she had losses of

1) Nicole earned a salary of $50,000 in 2015. She had losses of $12,000 in stock trades during the year. She will be able to deduct all of the losses from her income on her 2015 tax return. True or False 2) A corporation ...

Assume you just deposited 1000 into a bank account the

Assume you just deposited $1,000 into a bank account. The current real interest rate is 2%, and inflation is expected to be 6% over the next year. What nominal rate would you require from the bank over the next year? How ...

Why is it that when you have a trade deficit saving is less

Why is it that when you have a trade deficit saving is less than investment. S-I=NX. A trade deficit just means you bought more products from foreign sellers than you sold to them. So is a trade deficit even a bad thing? ...

1-2 page essay describing the obligations of corporate

1-2 page essay describing the obligations of corporate directors to a business corporation. In your essay discuss the different duties that active and inactive directors have with respect to the business corporations ope ...

Write an arduino program for an led connected to pin 3 to

Write an Arduino program for an LED connected to pin 3 to blink 7 times with a delay of 0.75 sec, then stays off. Use the FOR loop, and an increment of one. - Include your name, date, and description of program at the to ...

Leadership research essayfor this assignment you are

Leadership Research Essay For this assignment, you are required to write a Leadership Research Essay. Requirement: Using the terms, concepts, and theories learned in this course, write a 5 to 7 page (Times New Roman 12 f ...

1 assume that the eurozone risk free interest rate n bonds

1) Assume that the eurozone risk free interest rate n bonds with one year to maturity is 4.78 percent and the U.S. risk free rate on one year bonds is 3.15 percent. The currenct exchangerate is $0.90 per euro. assume the ...

  • 4,153,160 Questions Asked
  • 13,132 Experts
  • 2,558,936 Questions Answered

Ask Experts for help!!

Looking for Assignment Help?

Start excelling in your Courses, Get help with Assignment

Write us your full requirement for evaluation and you will receive response within 20 minutes turnaround time.

Ask Now Help with Problems, Get a Best Answer

A cola-dispensing machine is set to dispense 9 ounces of

A cola-dispensing machine is set to dispense 9 ounces of cola per cup, with a standard deviation of 1.0 ounce. The manuf

What is marketingbullwhat is marketing think back to your

What is Marketing? • "What is marketing"? Think back to your impressions before you started this class versus how you

Question -your client david smith runs a small it

QUESTION - Your client, David Smith runs a small IT consulting business specialising in computer software and techno

Inspection of a random sample of 22 aircraft showed that 15

Inspection of a random sample of 22 aircraft showed that 15 needed repairs to fix a wiring problem that might compromise

Effective hrmquestionhow can an effective hrm system help

Effective HRM Question How can an effective HRM system help facilitate the achievement of an organization's strate