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Forms of Market and Price Determination under Perfect Competition

Class XII
Economics
Forms of Market and Price Determination under Perfect Competition with Simple Applications
12 questions
HARD

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1. What is a key characteristic of a perfectly competitive market?

Single seller dominance · Homogeneous products · High barriers to entry · Price maker behavior

2. In a perfectly competitive market, firms are considered price:

Takers · Makers · Minimizers · Maximizers

3. Which of the following is NOT a condition for perfect competition?

Large number of buyers and sellers · Perfect knowledge of the market · Product differentiation · Freedom of entry and exit

4. At equilibrium in a perfectly competitive market, what happens to the price if demand increases?

Price decreases · Price remains constant · Price increases · Price fluctuates randomly

5. In the short run, a firm in perfect competition will continue to operate as long as it covers:

Total costs · Variable costs · Fixed costs · Average costs