1 of25

Which of the following is closest to a perfectly competitive market?

	the pizza market
	the market for breakfast cereal
	the market for corn
	the market for automobiles

Question

2 of25

The increase in total output of adding more workers is the ______________.

	marginal product of labor
	average product of labor
	increase in the wage bill of hiring another worker
	slope of the production possibility frontier

Question

3 of25

The Law of Diminishing Marginal Product applies because______ .

	labor is scarce
	capital is fixed.
	labor is expensive.
	it is hard to find good workers.

Question

4 of25

The difference between accounting profit and economic profit is:

	explicit costs
	implicit costs
	fixed costs
	variable costs

Question

5 of25

A perfectly competitive firm will have a marginal revenue curve that is the same as the firm's demand curve. Thus:

	every additional unit demanded, the firm sells an additional unit and revenue increases by less than the amount of market price.
	every additional unit demanded, the firm sells an additional unit and revenue increases by exact amount of market price.
	the firm is a price aker.
	MR = MC

Question

6 of25

The short-run is the period in which ______, while the long-run is the period in which ____________.

	the firm uses its current resources; the firm considers other resources
	at least one input is fixed; all inputs are variable
	the firm is concerned with current market conditions; the firm is concerned with future market conditions
	the firm cannot produce any more; the firm can expand production

Question

7 of25

A perfectly competitive firm faces a _______________

	supply chain issue.
	demand curve that is inelastic.
	vertical line drawn at the market price level.
	perfectly elastic demand curve for its product.

Question

8 of25

In Perfect Competition, all firms in a market

	have the same revenue structure.
	have the same cost structure.
	make the same profit.
	charge the same price.