In a perfectly competitive market, the demand curve faced by an individual firm is:
Downward - sloping.
Upward - sloping.
Horizontal.
Vertical.
A perfectly competitive firm is a:
Price - maker.
Quantity - taker.
Price - taker.
Quantity - maker.
In perfect competition, marginal revenue is:
Greater than price.
Less than price.
Equal to price.
Unrelated to price.
A firm in perfect competition maximizes profit when:
Marginal cost = Marginal revenue and marginal cost is rising.
Marginal cost > Marginal revenue.
Marginal cost < Marginal revenue.
Total cost = Total revenue.
In the long - run, a perfectly competitive firm will earn:
Positive economic profit.
Negative economic profit.
Zero economic profit.
It depends on the firm's cost structure.
Which of the following is a characteristic of a perfectly competitive market?
High barriers to entry.
Product differentiation.
Many buyers and sellers.
A single firm dominates the market.
If a perfectly competitive firm is producing at a level where price is less than AVC in the short - run, it should:
Continue to produce to minimize losses.
Shut down.
Increase production.
Decrease production.
In a monopoly, the firm is a:
Price - taker.
Quantity - taker.
Price - maker.
Quantity - maker.
A monopoly's demand curve is:
Horizontal.
Vertical.
Downward - sloping.
Upward - sloping.
For a monopoly, marginal revenue is:
Equal to price.
Greater than price.
Less than price.
Unrelated to price.
A monopoly maximizes profit when:
Marginal cost = Marginal revenue and marginal cost is rising.
Marginal cost > Marginal revenue.
Marginal cost < Marginal revenue.
Total cost = Total revenue.
Which of the following is a barrier to entry for a monopoly?
Easy access to resources.
High advertising costs for new entrants.
Absence of economies of scale.
Free entry of new firms.
A natural monopoly occurs when:
A firm has exclusive access to a natural resource.
The long - run average cost curve is falling down.
The government grants a monopoly license.
A firm's product is highly differentiated.
Monopolies generally lead to:
Allocative efficiency.
Productive efficiency.
A deadweight loss.
Perfect competition in the long - run.
In comparison to perfect competition, a monopoly will typically produce:
More output at a lower price.
More output at a higher price.
Less output at a lower price.
Less output at a higher price.
In a perfectly competitive market, new firms will enter when:
Existing firms are making a loss.
Existing firms are making zero economic profit.
Existing firms are making a positive economic profit.
The market price is below average variable cost.
A monopoly may engage in price discrimination to:
Increase consumer surplus.
Decrease producer surplus.
Maximize profit.
Minimize deadweight loss.