Theory Of Firm Under Perfect Competition CBSE Questions & Answers

Theory Of Firm Under Perfect Competition

This is Economics Class 12 Theory of Firm Under Perfect Competition CBSE Questions & Answers. There are 15 questions in this test with each question having around four answer choices.

Questions & Answers

1
While a seller under perfect competition equates price and MC to maximize profits a monopolist should equate?
  • A
    AR and MR
  • B
    MR and MC
    Correct
  • C
    AR and MC
  • D
    TC and TR
2
Marginal revenue in any competitive situation is?
  • A
    Trn-Pn-1
  • B
    TRn/Qn-1
  • C
    None of above
  • D
    TRn-TRn-1
    Correct
3
A rational consumer is a person who?
  • A
    Has perfect knowledge of the market
    Correct
  • B
    Knows the prices of goods in different market and buys the cheapest
  • C
    Is not influenced by persuasive advertising
  • D
    Behaves at all times, other things being equal, in a judicious manner
4
In which of the following types of market structures, are resources, assumed to be mobile?
  • A
    Oligopoly
  • B
    Monopolistic competition
  • C
    Monopoly
  • D
    Perfect competition
    Correct
5
At producer’s equilibrium when MR=MC, the firm earns only
  • A
    Abnormal profit
  • B
    Normal loss
  • C
    Abnormal loss
  • D
    Normal Profit
    Correct
6
Beyond producer’s equilibrium when MR<MC, the firm earns only
  • A
    Abnormal loss
    Correct
  • B
    Normal Profit
  • C
    Normal loss
  • D
    Abnormal profit
7
Before producer’s equilibrium when MR>MC, the firm earns only
  • A
    Normal Profit
  • B
    Normal loss
  • C
    Abnormal loss
  • D
    Abnormal profit
    Correct
8
A producer’s equilibrium is a situation when
  • A
    AR=AC
    Correct
  • B
    TR=TC
  • C
    MR=MC
  • D
    AR=MR
9
The elasticity at a point on a straight line supply curve passing through the origin will be
  • A
    1.0
    Correct
  • B
    2
  • C
    4
  • D
    3
10
The elasticity at a point on a straight line supply curve passing through the origin making an angle of 45°will be
  • A
    3
  • B
    1.0
    Correct
  • C
    2
  • D
    4
11
Under perfect competition the number of firms
  • A
    Is about 10
  • B
    Is limited
  • C
    Is large
    Correct
  • D
    Are many but limited
12
2. When ___________, the firms are earning just normal profit:
  • A
    AC=AR
    Correct
  • B
    MC=MR
  • C
    AR=MR
  • D
    MC=AC
13
Which of the following is the condition for equilibrium of a firm?
  • A
    None of above
  • B
    MC curve must cut MR curve from above
  • C
    MR = MC
    Correct
  • D
    Both of these
14
4. In perfect competition, since the firm is a price taker, the ________ curve is straight line
  • A
    Total cost
  • B
    Marginal revenue
    Correct
  • C
    Total revenue
  • D
    Marginal cost
15
5. Other name by which average revenue curve known:
  • A
    Indifference curve
  • B
    Profit curve
  • C
    Demand curve
    Correct
  • D
    Average cost curve