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Which characteristic is NOT a defining feature of a perfectly competitive market?

In perfectly competitive markets, individual businesses are considered:

What is the primary objective of a firm operating in a perfect market?

In the long run, what type of profits do firms in perfectly competitive markets typically make?

What happens when the marginal revenue (MR) is greater than the marginal cost (MC) for a firm in a perfect market?

Perfect competition serves as a benchmark for:

Which of the following is a characteristic of a monopoly?

What is a key feature of an oligopoly?

In monopolistic competition, firms primarily compete through:

Why might a monopolist's marginal revenue curve lie below its demand curve?

What is the main reason that firms in monopolistically competitive markets can only earn normal profits in the long run?

How do monopolies and oligopolies typically affect market efficiency?

Which of the following best describes a 'kinked' demand curve?

How does product differentiation impact market dynamics under monopolistic competition compared to perfect competition?

What is the primary implication of barriers to entry in a monopolistic market structure?

Which of the following constitutes a market failure?

What is an example of a negative externality?

Which characteristic defines a public good?

What is a merit good?

How does imperfect competition lead to market failure?

Asymmetric information can lead to market failure because:

What is the result of the immobility of factors of production?

Imperfect distribution of income and wealth can cause market failure by:

Productive inefficiency means:

What is the purpose of state intervention in the context of market failures?

How do negative externalities affect social welfare?

What is cost-benefit analysis (CBA) used for?

Which of the following interventions is least likely to be used by a government to correct a market failure related to a negative externality?

When evaluating a public project using cost-benefit analysis (CBA), which discount rate would yield the highest net present value, assuming all other variables are constant?

Which of the following scenarios best exemplifies the 'tragedy of the commons' as a type of market failure?

What is the most direct effect of imposing a binding price ceiling on a market?

What is the key difference between allocative and technical efficiency?

Which government policy aims to correct information asymmetry between buyers and sellers in a market?

How might government intervention to correct a market failure due to a positive externality impact the market?

In the context of market failures, what is the 'free-rider problem,' and with which type of good is it most commonly associated?

Which of the following represents the most significant challenge when attempting to perform a cost-benefit analysis for a large-scale environmental protection project? Assume that this project only impacts a single generation.

A major city implements a congestion pricing system, charging drivers a fee to enter the city center during peak hours. While this aims to reduce traffic and pollution (negative externalities), which unintended consequence is most likely to arise, exacerbating income inequality?

Which of the following characteristics is NOT indicative of a perfect market?

In a perfectly competitive market, what primarily dictates the price at which firms sell their product?

When marginal cost (MC) exceeds marginal revenue (MR) in a perfect market, a firm should:

What is the long-run equilibrium condition for firms in a perfectly competitive market?

Barriers to entry are a key characteristic of which market structure?

In an oligopoly, firms are characterized by:

What is a common strategy employed by firms in monopolistic competition?

Why does a monopolist's marginal revenue curve typically lie below its demand curve?

What is the primary reason firms in monopolistically competitive markets tend to earn only normal profits in the long run?

How do monopolies and oligopolies typically impact market efficiency compared to perfect competition?

What does a 'kinked' demand curve typically indicate in the context of oligopoly markets?

Which factor is most likely to give rise to a natural monopoly?

A market failure occurs when:

Which of the following is an example of a positive externality?

What characteristic is MOST associated with public goods?

Why are merit goods often under-consumed in a free market?

How can asymmetric information lead to market failure?

What outcome is MOST likely a consequence of the immobility of factors of production?

How does an imperfect distribution of income contribute to market failure?

What BEST defines productive inefficiency?

Why does a government intervene in markets experiencing failures?

What is a likely consequence of negative externalities on social welfare?

For what purpose is cost-benefit analysis (CBA) primarily used?

Which policy intervention would MOST directly address a negative externality caused by a factory's pollution?

What is the MOST likely outcome of a successful government subsidy on education, designed to correct a market failure?

Which of the following market failures is MOST directly addressed by antitrust laws?

What is the primary purpose of imposing a carbon tax?

In economic terms, what does 'moral hazard' describe?

What is the MOST likely outcome of imposing a rent control (price ceiling) below the equilibrium rent level?

Which situation exemplifies the problem of 'adverse selection' in markets?

How does the presence of significant positive externalities typically affect market equilibrium?

Consider a situation where a new technology significantly reduces the cost of producing solar panels. How would this MOST likely affect the market for electricity, especially concerning market failures?

A local government decides to build a new public park. Which of the following valuation methods would be MOST appropriate to estimate the benefits that local residents receive from the park, especially those benefits that are not easily quantifiable in monetary terms?

In a city recently hit by a severe hurricane, the price of bottled water skyrockets. Which of the following economic arguments BEST justifies a government intervention to prevent price gouging in this scenario, from an equity and efficiency perspective?

Suppose that a new study reveals that a common agricultural pesticide, while increasing crop yields, also causes significant neurological damage to children living in nearby areas. Considering only this information, which action aligns BEST with an economist’s recommendation aimed at achieving economic efficiency?

A country requires all firms to install the 'best available control technology' (BACT) to reduce pollution, irrespective of the cost or the environmental benefits achieved. Many economists argue this is an inefficient approach. Which of the following is the strongest argument supporting this view, from an economic efficiency perspective?

Imagine that a city introduces a congestion charge for driving in the city center, but simultaneously reduces the tax on parking. What is the MOST likely overall effect on traffic congestion, and why?

What condition characterizes a perfect market regarding the number of participants?

What does 'homogeneous products' imply in the context of perfect competition?

In a perfectly competitive market, what is the nature of information available to buyers and sellers?

What role does government regulation play in a perfectly competitive market?

How does the concept of 'price taker' apply to individual businesses in a perfect market?

What condition defines profit maximization for a firm in a perfect market?

In the long run, what is the typical profit outcome for firms in perfectly competitive markets and why?

How does the structure of perfect competition serve as a benchmark for real-world markets?

In a monopoly, how does the price typically compare to marginal cost at the profit-maximizing output level?

What is a primary characteristic of an oligopoly that distinguishes it from other market structures?

What is a common strategy employed by firms in monopolistic competition to differentiate their products?

Why do firms in monopolistically competitive markets typically earn only normal profits in the long run?

What is a likely consequence of monopolies and oligopolies on market efficiency?

Which factor primarily allows a monopoly to maintain its market dominance?

How does product differentiation affect market dynamics in monopolistic competition compared to perfect competition?

What happens when the price mechanism leads to an inefficient allocation of resources, resulting in a net social welfare loss?

What is a defining characteristic of a public good that often leads to its underproduction in private markets?

Which of the following describes a situation where one party in a transaction has more information than the other?

How does immobility of factors of production contribute to market failure?

What is the economic term for the failure to use resources to their full potential?

What is a carbon tax designed to address?

What is a likely outcome of imposing a binding price ceiling in a market?

Which situation exemplifies moral hazard?

How does imperfect distribution of income and wealth contribute to market failure?

What is the primary purpose of cost-benefit analysis (CBA)?

Why might merit goods be under-consumed in a free market?

What problem does 'adverse selection' describe?

Which of the following best describes an externality?

What type of inefficiency results from resources not being allocated according to consumer preferences?

How does a monopolist's marginal revenue (MR) typically compare to the price of their product?

What is the primary economic justification for government intervention in cases of market failure?

A new technology significantly reduces the cost of producing solar panels. How would this MOST likely affect the market for electricity, especially concerning market failures?

If a perfectly competitive firm's marginal cost is $15 and its average total cost is $12 when producing 100 units, what should the firm do to maximize profits in the short run if the market price is $20?

Assume that country A and country B are identical in every aspect, however the market for Good X in country A is closer to perfect competition, compared to country B. Which of the following is most likely to be true given these assumptions?

There is a new proposal to tax a good that generates a negative externality, but economists are unsure the tax will correct it because the demand is perfectly inelastic. Which of the following statements can explain why?