Perfect Competition MCQs (part 1 of 2)

Which of the following is NOT one of the four market structures?

• Perfect competition

• Monopolistic competition

• Oligopoly

• Duopoly

What is a key characteristic of firms in perfect competition?

• They have control over the price

• Their products are perfect substitutes

• There are only a few large firms

• They produce differentiated products

In perfect competition, the demand curve for an individual firm is:

• Vertical

• Horizontal

• Upward sloping

• Downward sloping

What does MR=D=AR=P stand for in perfect competition?

• Marginal Revenue = Demand = Average Revenue = Production

• Marginal Revenue = Demand = Average Revenue = Profit

• Marginal Revenue = Demand = Average Revenue = Price

• Marginal Revenue = Demand = Average Revenue = Product

At what point should a firm stop producing to maximize profit?

• When MR > MC

• When MR < MC

• When MR = MC

• When MC > ATC

If a firm in perfect competition raises its price above the market price, what happens?

• It will sell more units

• It will sell no units

• It will sell fewer units

• It will sell the same number of units

What is the profit-maximizing quantity for a firm in perfect competition?

• Where demand is highest

• Where MC > MR

• Where MR = MC

• Where ATC is minimized

In the given example, what is the total revenue if the firm sells 10 units at $10 each?

• $60

• $10

• $100

• $40

How is the total cost calculated in the example?

• Fixed cost plus variable cost

• Marginal cost per unit multiplied by quantity

• Average total cost per unit multiplied by quantity

• Price per unit multiplied by quantity

What is the economic profit if the total revenue is $100 and the total cost is $60?

• $40

• $10

• $60

• $100