Multiple Choice - Select Best Answer Which of the following markets comes closes
ID: 1247951 • Letter: M
Question
Multiple Choice - Select Best AnswerWhich of the following markets comes closes to the model of perfect competition?
a. information technology industry
c. automobile industry
b. aerospace industry
d. agriculture
Which of the following conditions would definitely cause a perfectly competitive company to shut down in the short run?
a. P = MR
c. P < MC
b. P < AVC
d. P = MC < AC
Demand facing an individual, perfectly competitive firm is
a. perfectly elastic at the price the firm chooses to charge.
b. perfectly elastic at the price determined by market forces.
c. perfectly inelastic at the quantity the firm chooses to produce.
d. perfectly inelastic at the quantity determined by market forces.
In perfect competition, if firms enter the market in the long run
a. total supply will increase causing market price to increase.
b. total supply will decrease causing market price to decrease.
c. total supply will increase causing market price to decrease.
d. total supply will decrease causing market price to increase.
Which is a required characteristic of a perfectly competitive industry?
a. Barriers to entry are high
b. There are few firms so that none can influence market price.
c. Products are highly differentiated.
d. None of the above
Explanation / Answer
1) d. There are lots of farmers out there, and a single firm can't control price. They also don't have product differentiation. 2) it is marked as b, but it is the 3rd one (PRelated Questions
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