Economics Grade 12 Quiz Paper 2

What is a key feature of perfect competition?

• Price-setting firms

• Differentiated products

• Few sellers

• Homogeneous products

In perfect competition, firms are...

• Price makers

• Government regulated

• Price takers

• Product innovators

What occurs when AR = AC?

• Loss

• Shutdown

• Normal profit

• Maximum loss

Which curve acts as the supply curve for a perfectly competitive firm in the short run?

• ATC below AVC

• AR

• MC above AVC

• MR below AR

A monopoly is characterised by...

• Many buyers and sellers

• Homogeneous goods

• No barriers to entry

• One dominant seller

In a monopoly, the MR curve lies...

• Above the AR curve

• Equal to AR

• Below the AR curve

• Flat and horizontal

What is the shape of the demand curve under monopolistic competition?

• Perfectly elastic

• Downward-sloping

• Kinked

• Vertical

What best explains price stability in oligopoly?

• Free entry

• Homogeneous products

• Kinked demand curve

• Government control

What is an example of non-price competition?

• Price war

• Subsidy

• Advertising

• Maximum pricing

Which of the following is a cause of market failure?

• Perfect information

• Efficient allocation

• Externalities

• Equal income distribution