#1
In perfect competition, what is the degree of control over price that individual firms have?
#2
What is the characteristic feature of a perfectly competitive market?
Homogeneous products
Product differentiation
Monopoly power
Oligopoly structure
#3
In perfect competition, what is the shape of the demand curve facing a single firm?
Upward sloping
Downward sloping
Horizontal
Vertical
#4
What is the long-run equilibrium condition for firms in perfect competition?
Maximized profit
Marginal revenue equals marginal cost
Price equals marginal cost
Price equals average total cost
#5
What is the short-run shutdown condition for firms in perfect competition?
Price is less than average variable cost
Price is less than average total cost
Price is less than marginal cost
Price is less than average fixed cost
#6
What is the relationship between marginal revenue and price in perfect competition?
Marginal revenue is greater than price
Marginal revenue equals price
Marginal revenue is less than price
Marginal revenue is undefined in perfect competition
#7
What is the slope of the demand curve facing a perfectly competitive firm?
Positive
Negative
Zero
Infinite
#8
Which of the following is NOT a characteristic of perfect competition?
Many buyers and sellers
Homogeneous products
Barrier to entry
Perfect information
#9
What happens to economic profit in the long run in perfect competition?
Economic profit increases
Economic profit decreases
Economic profit equals zero
Economic profit becomes negative
#10
What is allocative efficiency in perfect competition?
When firms produce at the lowest point on their average total cost curve
When firms produce at the highest point on their average total cost curve
When firms produce where marginal cost equals price
When firms produce where marginal cost equals marginal revenue
#11
In the long run, what happens to the number of firms in perfect competition if firms are making positive economic profit?
New firms enter the market
Existing firms exit the market
The number of firms remains constant
There is no long run in perfect competition
#12
What is a characteristic of the demand curve facing a perfectly competitive firm in the short run?
Perfectly elastic
Perfectly inelastic
Unit elastic
None of the above