Market Management and Competition Quiz

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What is the goal of each firm in perfect competition?

Maximize total revenue

Minimize total cost

Maximize market share

Maximize economic profit (correct)

What does a firm’s marginal revenue represent in perfect competition?

The average revenue per unit sold

The opportunity cost of production

The change in total revenue from selling one more unit (correct)

The change in total cost from selling one more unit

What is the demand curve for a firm's product in perfect competition?

Perfectly inelastic at the market price

Sloping upwards from left to right

Sloping downwards from left to right

Perfectly elastic at the market price (correct)

What does a perfectly competitive firm choose to maximize its economic profit?

The output that maximizes economic profit by examining total revenue and total cost curves Signup and view all the answers

When is profit maximized for a firm in perfect competition according to marginal analysis?

When marginal revenue equals marginal cost Signup and view all the answers

In perfect competition, what is the relationship between established firms and new ones?

Established firms have no advantages over new ones Signup and view all the answers

What is the characteristic of a firm in perfect competition regarding its influence on the price of a good or service?

The firm has no influence on the price Signup and view all the answers

What condition leads to the emergence of perfect competition?

Large minimum efficient scale relative to market demand Signup and view all the answers

Which of the following is NOT a characteristic of perfect competition?

Established firms having advantages over new ones Signup and view all the answers

What type of market structure does perfect competition belong to?

Perfectly competitive Signup and view all the answers

What is the goal of each firm in perfect competition?

To maximize economic profit Signup and view all the answers

In perfect competition, what does a firm’s marginal revenue represent?

The change in total revenue due to a one-unit increase in quantity sold Signup and view all the answers

What does the demand curve for a firm's product look like in perfect competition?

It is perfectly elastic Signup and view all the answers

When is profit maximized for a firm in perfect competition according to marginal analysis?

When marginal revenue is greater than marginal cost Signup and view all the answers

What type of market structure does perfect competition belong to?

Perfectly competitive market Signup and view all the answers

Which of the following is a characteristic of perfect competition?

Established firms have advantages over new ones Signup and view all the answers

What condition leads to the emergence of perfect competition?

Low barriers to entry into the industry Signup and view all the answers

In perfect competition, what is the relationship between established firms and new ones?

Established firms have advantages over new ones Signup and view all the answers

What is the goal of each firm in perfect competition?

To maximize economic profit Signup and view all the answers

What is the demand curve for a firm's product in perfect competition?

Horizontal Signup and view all the answers

Market Management and Competition Quiz

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Questions and Answers

What is the goal of each firm in perfect competition?

What does a firm’s marginal revenue represent in perfect competition?

What is the demand curve for a firm's product in perfect competition?

What does a perfectly competitive firm choose to maximize its economic profit?

When is profit maximized for a firm in perfect competition according to marginal analysis?

In perfect competition, what is the relationship between established firms and new ones?

What is the characteristic of a firm in perfect competition regarding its influence on the price of a good or service?

What condition leads to the emergence of perfect competition?

Which of the following is NOT a characteristic of perfect competition?

What type of market structure does perfect competition belong to?

What is the goal of each firm in perfect competition?

In perfect competition, what does a firm’s marginal revenue represent?

What does the demand curve for a firm's product look like in perfect competition?

When is profit maximized for a firm in perfect competition according to marginal analysis?

What type of market structure does perfect competition belong to?

Which of the following is a characteristic of perfect competition?

What condition leads to the emergence of perfect competition?

In perfect competition, what is the relationship between established firms and new ones?

What is the goal of each firm in perfect competition?

What is the demand curve for a firm's product in perfect competition?

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