Chapter 6 ECONOMICS : Market Structure — Online MCQ Test
ECONOMICS · CLASS 11 INTER I YEAR · Andhra State Board
Practice Chapter 6 ECONOMICS : Market Structure with a free chapter-wise online MCQ test.
This chapter covers: This chapter details market classification price and output determination under perfect competition monopoly monopolistic competition and oligopoly..
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Chapter 6 ECONOMICS : Market Structure — Important Questions & Answers
Which market structure is characterized by a single seller and no close substitutes?
- A. Perfect Competition
- B. Monopoly
- C. Monopolistic Competition
- D. Oligopoly
Answer: B. Monopoly
A monopoly exists when there is only one supplier in the market producing a product with no close substitutes.
A monopoly exists when there is only one supplier in the market producing a product with no close substitutes.
In perfect competition, firms are considered to be:
- A. Price makers
- B. Price takers
- C. Price discriminators
- D. Price leaders
Answer: B. Price takers
Since there are many buyers and sellers in perfect competition, individual firms must accept the market price.
Since there are many buyers and sellers in perfect competition, individual firms must accept the market price.
Which market form is best represented by the concept of 'product differentiation'?
- A. Perfect Competition
- B. Monopoly
- C. Monopolistic Competition
- D. Pure Oligopoly
Answer: C. Monopolistic Competition
Monopolistic competition involves many sellers offering products that are similar but not identical, allowing for brand differentiation.
Monopolistic competition involves many sellers offering products that are similar but not identical, allowing for brand differentiation.
Why is the average revenue (AR) curve also the demand curve for a firm?
- A. Because AR equals marginal cost
- B. Because AR shows the amount consumers are willing to pay at different prices
- C. Because AR is always constant
- D. Because supply equals demand
Answer: B. Because AR shows the amount consumers are willing to pay at different prices
The average revenue represents the price per unit, which is the same as the price consumers are willing to pay at various quantities.
The average revenue represents the price per unit, which is the same as the price consumers are willing to pay at various quantities.
A firm in monopolistic competition faces a downward sloping demand curve because:
- A. It has no competitors
- B. It produces a unique product with no substitutes
- C. Its product is differentiated, giving it some market power
- D. It is a price taker
Answer: C. Its product is differentiated, giving it some market power
Because products are differentiated, the firm has limited control over its price, resulting in a downward-sloping demand curve.
Because products are differentiated, the firm has limited control over its price, resulting in a downward-sloping demand curve.