Perfect Competition Part 1 Quiz

Which of the following is not a characteristic of a perfectly competitive market?

•  Many small firms

•  Identical products

•  Low Barriers To Entry and Exit

• Firms Are Price Takers

• Firms Are Price Makers

Which of the following is true for a firm in perfect competition?

• Sellers have no control over price

• Sellers can set prices higher than their competitors.

• There are no barriers to entry or exit.

• Buyers have no influence on the prices charged by sellers.

• Sellers have full control over price

In perfect competition, the price is set by

• The market

• The government

• Individual firms

• A monopoly

Marginal Revenue is also equal to

• Demand, Average Revenue, and Price

• Total Revenue

• Cost of Goods Sold

• Profit Margin

Profit is equal to

• Total revenue minus total cost

• Total cost times average cost

• Average total cost minus marginal cost

• The amount of money invested by a company

The profit maximizing point is MR = MC

• True

• False

Draw the price that the firm will take

A firm in perfect competition sets its price above market price. It will earn...

• No profit

• Economic Profit

• Accounting Profit

• An increase in customers

• A decrease in customers