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- Subject
- Costs , Supply And Perfect Competitioneconomics-mcqs › costs-supply-and-perfect-competition
- Published
- 2 Jun 2019
- Last updated
- 28 May 2026
Explanation
In the long run under perfect competition, firms produce where price equals average cost and marginal cost, ensuring zero economic profit. Option A correctly represents this equilibrium, while the other options do not accurately describe the long-run condition.
More Costs , Supply And Perfect Competition MCQs
Practice related questions from the same subject.
- 1.In the context of a perfectly competitive firm, what represents its short-run supply curve and its long-run supply curve respectively?
- 2.Under what condition will a firm cease production and produce nothing in the short term?
- 3.In the short run, the average total cost is composed of which two components?
- 4.What is the relationship between marginal cost and average cost when the average cost is decreasing and when it is increasing?
- 5.What does it indicate when the long-run average cost curve slopes downward from left to right?
- 6.Which characteristic best describes a monopoly market structure?
- 7.According to Porter's Five Forces framework, what is the likely impact on supplier power when a company acquires one of its competitors?
- 8.In a monopolistic competition market, when firms earn abnormal profits, what is the expected effect on marginal cost as new firms enter the industry?
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