AGR113 - CHAPTER 7

In short run, how can firm in pure competition gain maximum profit?

• Increasing the output

• Adjusting the output

• Decreasing the output

• Set a higher price

This market model sells differentiated products. Choose the correct market model.

• Pure competition

• Monopoly

• Monopolistic competition

• Oligopoly

In long run, what type of profit can pure competition firm earn?

• Supernormal profit

• Normal profit

• Subnormal profit

• - Mutual interdependence

• - Collusive tendencies

• - Incentive to cheat

The followings can happen in _______ market model.

• Pure competition

• Pure monopoly

• Monopolistic competition

• Oligopoly

Market model that rely on advertising is

• Pure competition

• Pure monopoly

• Monopolistic competition

• Oligopoly

In long run, firm in pure competition can only earn (a) due to (b)

• (a) economic profit

  (b) free entry and exit of firm

• (a) normal profit

  (b) standardized products

• (a) economic profit

  (b) price taker

• (a) normal profit

  (b) free entry and exit of firm

Firm in pure competition cannot set their own pricing, but instead the price is determined by _________

Choose ALL barriers to entry for pure monopoly.

• Diseconomies of scale

• Control of alternative resources

• Patents

• Licenses

______ set their own pricing without taking into consideration of their rival's reaction.

• Pure competition

• Pure monopoly

• Monopolistic competition

• Oligopoly

Price discrimination can only occur if ____ (choose ALL correct answers)

• Some monopoly power

• Can classify buyers into different categories

• Can set the price according to the supply

• Buyers unable to sell the products back to others