2. USAEO Microeconomics
Perfect Competition — Quiz
Test your understanding of perfect competition with 5 practice questions.
Practice Questions
Question 1
In a perfectly competitive market, what condition must hold true for a firm to maximize its profit in the short run?
Question 2
Which of the following best describes the long-run equilibrium in a perfectly competitive industry?
Question 3
Consider a perfectly competitive firm that faces a market price of $P$. If the firm’s short-run marginal cost function is $MC = 4Q$, and its average total cost function is $ATC = 2 + 2Q$, what is the profit-maximizing quantity of output?
Question 4
In the short run, a perfectly competitive firm will continue to produce as long as which condition holds true?
Question 5
Suppose a perfectly competitive firm’s short-run total cost function is given by $TC = 50 + 5Q + Q^2$. What is the firm’s short-run supply function?