Market Competition Basics
Authored by Van CHAU
Business
2nd Grade
Used 6+ times
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15 questions
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1.
MULTIPLE CHOICE QUESTION
30 sec • 1 pt
What type of market structure is characterized by many small firms, identical products, and free entry and exit?
Perfect Competition
Monopoly
Oligopoly
Monopolistic Competition
2.
MULTIPLE CHOICE QUESTION
30 sec • 1 pt
In perfect competition, are firms price takers or price makers?
Price controllers
Price influencers
Price takers
Price setters
3.
MULTIPLE CHOICE QUESTION
30 sec • 1 pt
What is the main goal of a competitive firm in terms of profit?
Maximize profit by producing at the quantity where average total cost is minimized.
Ignore profit and focus on increasing market share.
Minimize profit by producing at the quantity where marginal cost equals marginal revenue.
Maximize profit by producing at the quantity where marginal cost equals marginal revenue.
4.
MULTIPLE CHOICE QUESTION
30 sec • 1 pt
In perfect competition, what is the shape of the marginal revenue curve?
Zigzag line
Curved line
Vertical line
Horizontal line
5.
MULTIPLE CHOICE QUESTION
30 sec • 1 pt
At what point does a firm shut down in the short run?
When the total revenue is less than the total variable costs
When total revenue is less than total fixed costs
When total revenue equals total variable costs
When total revenue is greater than total variable costs
6.
MULTIPLE CHOICE QUESTION
30 sec • 1 pt
What is the key feature of a perfectly competitive market?
Limited information available to buyers and sellers
Many buyers and sellers with identical products and perfect information
High barriers to entry for new firms
Few buyers and sellers with different products
7.
MULTIPLE CHOICE QUESTION
30 sec • 1 pt
How does a competitive firm determine its profit-maximizing level of output?
Set average cost equal to average revenue to find the level of output where profit is maximized.
Set marginal cost equal to marginal revenue to find the level of output where profit is maximized.
Choose the level of output where total cost is minimized.
Select the output level that generates the highest fixed costs.
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