Profit Maximizing Under Perfect Competition And Monopoly
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- Profit Maximizing Under Perfect Competition And Monopolyeconomics-mcqs › profit-maximizing-under-perfect-competition-and-monopoly
- Published
- 30 May 2019
- Last updated
- 28 May 2026
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Over an extended period, which of the following statements is true?
Multiple choice question for Profit Maximizing Under Perfect Competition And Monopoly. Select an option, then review the explanation below.
Explanation
In the long run, all inputs are variable, meaning no factors of production are fixed. This allows firms to adjust all resources to optimize production. Therefore, option B is correct. The other options are incorrect because firms do not necessarily earn economic profits (A), they can change the input mix (C), and they can fully exit the industry, not just shut down temporarily (D).
More Profit Maximizing Under Perfect Competition And Monopoly MCQs
Practice related questions from the same subject.
- 1.In markets that are contestable, how do dominant oligopoly firms typically behave?
- 2.According to the kinked demand curve model in oligopoly markets, how does the elasticity of demand behave when prices change?
- 3.Under which scenario is a cartel most likely to be successful?
- 4.What term describes an agreement between parties to set prices and output levels collectively?
- 5.What do we call an industry where only a few companies hold the majority of market power?