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Economics · Class 12 Commerce

Ch 19Market Structure and Price Determination — Class 12 Economics, concept-first.

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Perfect Competition: Features and Equilibrium

A perfectly competitive market has a very large number of buyers and sellers (each too small to influence price), a homogeneous product, free entry and exit, and perfect information — so every firm is a price taker facin…

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+Sample & Board questionsi34 questions
  1. Q1Show how the price of a commodity is determined through the interaction of aggregate demand and aggregate supply in a perfectly competitive…Preview
  2. Q2In a monopoly market at the equilibrium position market price will be— (a) equal to AC (b) equal to MC (c) equal to AR (d) equal to MR.Preview
  3. Q3If the percentage change in the quantity supplied is equal to the percentage change in price, then the price elasticity of supply is— (a) 0…Preview
  4. Q4Fill in the blank: If prices of factors of production rise, the supply curve of the commodity shifts to the ___. **Or** Fill in the blank: I…Preview
  5. Q5Fill in the blank: In the mark-up theory, Price = ___ + mark up.Preview
  6. Q6Write true or false: All firms in a perfectly competitive market sell a homogeneous product. **Or** Write true or false: In an oligopoly mar…Preview
  7. Q7Write the features of a perfectly competitive market. **Or** What is a shutdown point? Explain the circumstances under which a perfectly com…Preview
  8. Q8In case of perfectly inelastic supply, the supply curve is (a) horizontal (b) vertical (c) downward sloping (d) upward rising.Preview
  9. Q9Fill in the blank: In the mark-up system it is assumed that the long-run industry supply curve will be ___.Preview
  10. Q10Write true or false: There exists no difference between firm and industry in a monopoly market.Preview
  11. Q11Write true or false: If there are losses of crops due to drought, the supply curve of an agricultural product will be downward sloping.Preview
  12. Q12If price elasticity of supply is infinity, the supply curve will be— (a) backward bending (b) upward rising from left to right (c) vertical…Preview
  13. Q13Write true or false: In a monopolistically competitive market, each firm sells a differentiated product having many close substitutes. **Or*…Preview
  14. Q14Fill in the blank: The main proponent of the theory of mark-up pricing is ___.Preview
  15. Q15Write true or false: If production of an agricultural crop in a season increases due to favourable weather, the supply curve of the agricult…Preview
  16. Q16Fill in the blank: In a monopoly market, price and ___ revenue are always equal. **Or** Fill in the blank: The demand curve facing a monopol…Preview
  17. Q17If the price elasticity of supply is zero, the supply curve will be— (a) backward bending (b) upward sloping from left to right (c) vertical…Preview
  18. Q18The demand curve for the goods sold by a monopolist is always— (a) upward sloping (b) downward sloping (c) vertical (d) horizontal.Preview
  19. Q19Write true or false: If the supply curve is a straight line passing through the origin, then at every point on it the value of the price ela…Preview
  20. Q20Fill in the blank: In a ___ market, there is no difference between a firm and an industry. **Or** Fill in the blank: In a perfectly competit…Preview
  21. Q21Fill in the blank: In the case of manufactured/industrial goods, price is ___ determined. **Or** Fill in the blank: Under the Mark-up system…Preview
  22. Q22What are the necessary and sufficient conditions for the short-run equilibrium of a perfectly competitive firm? Show how, when these conditi…Preview
  23. Q23If the law of supply holds, the supply curve will be— (a) vertical (b) upward sloping (c) horizontal (d) downward sloping.Preview
  24. Q24One condition for equilibrium in a monopoly business is— (a) MR = MC (b) P = MC (c) P = MR (d) MC = AC.Preview
  25. Q25Fill in the blank: If production cost increases due to a rise in workers' wages, the firm's supply curve shifts ___.Preview
  26. Q26Write true or false: In a perfectly competitive market, firms sell goods at different prices from one another. **Or** Write true or false: O…Preview
  27. Q27Write true or false: In a perfectly competitive market, there is only one seller. **Or** Write true or false: The value of the Lerner's mono…Preview
  28. Q28State the assumptions of the marginal productivity theory of distribution. **Or** How is the wage rate determined in a perfectly competitive…Preview
  29. Q29At equilibrium in the monopoly market, the value of price elasticity is— (A) zero (B) more than 1 (C) less than 1 (D) 1.Preview
  30. Q30When the supply curve is an upward sloping straight line starting from the origin, then the value of elasticity of supply (e_s) will be— (A)…Preview
  31. Q31Write true or false: A perishable good has a very high price elasticity of supply. **Or** Write true or false: If there are losses of crops…Preview
  32. Q32Fill in the blank: In monopolistic competition each seller sells a ___ product.Preview
  33. Q33Write true or false: According to Lerner, the degree of monopoly power = (P - MC)/P. **Or** Write true or false: At equilibrium in the monop…Preview
  34. Q34Write true or false: Mark-up is nothing but planned profit. **Or** Write true or false: In case of an industrial good, price is cost-determi…Preview