#1
Which of the following is a characteristic of purely competitive industries?
High barriers to entry
Homogeneous products
Substantial control over price by individual firms
Few sellers in the market
#2
In purely competitive industries, firms are often described as price _____.
Leaders
Takers
Setters
Manipulators
#3
What is the demand curve like for an individual firm in a purely competitive market?
Vertical
Downward-sloping
Horizontal
Upward-sloping
#4
In a purely competitive market, what happens to the price if the demand increases?
Price increases
Price decreases
Price remains constant
Price fluctuates randomly
#5
What happens to the demand curve for an individual firm in a purely competitive market if there is a decrease in the market price?
The demand curve shifts leftward
The demand curve shifts rightward
The demand curve becomes steeper
The demand curve remains unchanged
#6
In a purely competitive market, what happens to the price if a firm decreases its production?
Price increases
Price decreases
Price remains constant
Price fluctuates randomly
#7
What is a characteristic feature of a purely competitive industry?
High barriers to entry
Product differentiation
Perfect knowledge among buyers and sellers
Substantial pricing power for individual firms
#8
Which of the following is a key condition for a purely competitive market?
Product differentiation
Monopolistic control over resources
Perfect mobility of resources
Centralized decision making
#9
In a purely competitive market, what happens if a firm sets its price above the market equilibrium?
The firm sells more units than its competitors
The firm sells fewer units than its competitors
The firm faces no consequences
The firm will not be able to sell any units
#10
Which of the following is a characteristic of a purely competitive market in the long run?
Economic profits are zero
Economic profits are maximized
Economic profits are minimized
Economic profits are negative
#11
In a purely competitive market, what does the marginal revenue curve look like?
It is downward-sloping
It is upward-sloping
It is horizontal
It is vertical
#12
In a purely competitive market, what happens to economic profits in the long run?
Economic profits increase indefinitely
Economic profits remain constant
Economic profits decrease to zero
Economic profits become negative
#13
Which of the following is a characteristic of a perfectly competitive market?
Limited number of buyers and sellers
Existence of entry barriers
Product differentiation
Price taker behavior
#14
What is a characteristic of a purely competitive market in terms of information?
Perfect knowledge
Asymmetric information
Complete secrecy
Limited access to information
#15
In a purely competitive market, what is the relationship between marginal revenue and price?
Marginal revenue is greater than price
Marginal revenue is equal to price
Marginal revenue is less than price
There is no relationship between marginal revenue and price
#16
Which of the following is a characteristic of a purely competitive market in the short run?
Firms can enter or exit the market freely
Firms can earn economic profits
Firms produce at the minimum average total cost
Firms have full control over market price
#17
Which of the following is a characteristic of a purely competitive market?
High barriers to entry
Product differentiation
Substantial control over price by individual firms
Many buyers and sellers
#18
Which of the following statements is true about a purely competitive market?
Firms can exert substantial influence over market price
Firms can easily differentiate their products from competitors
Firms face significant barriers to entry
Firms are price takers
#19
What is a characteristic of a perfectly competitive market?
High degree of product differentiation
Control over market price by individual firms
Ease of entry into the market
Existence of few sellers in the market
#20
What happens to the price in a purely competitive market if individual firms increase production?
Price increases
Price decreases
Price remains constant
Price fluctuates randomly
#21
Which of the following is not a characteristic of a purely competitive market?
Homogeneous products
Low barriers to entry
Substantial pricing power for individual firms
Many buyers and sellers
#22
Which of the following is a feature of long-run equilibrium in a purely competitive market?
Price is above average total cost
Price is below average total cost
Price equals average total cost
Price is irrelevant to production decisions