1			What is the name of the type of market that is dominated by a few firms?
			A)	Oligopoly
			B)	Monopolistic competition
			C)	Monopoly
			D)	Perfect competition
2			Which of the following is true for a perfectly competitive firm?
			A)	It can control its price but not its output.
			B)	It can control its output but not its price.
			C)	It can control both its price and its output.
			D)	It cannot control either its price or its output.
3			How is average revenue defined?
			A)	It is the extra revenue derived from the sale of one more unit.
			B)	It is the total revenue divided by the number of units sold.
			C)	It is marginal revenue divided by the number of units sold.
			D)	It is the sum of the marginal revenue of all units sold.
4			What type of product is sold by the representative firm in a perfectly competitive market?
			A)	The same as is sold by the other firms
			B)	A unique product
			C)	A product different from that sold by the other firms
			D)	It could be any of the above three types
			E)	5
5			What does break-even output mean?
			A)	The output at which the price is equal to the average revenue
			B)	The output at which the price is equal to the marginal revenue
			C)	The output at which the price is equal to the average cost
			D)	The output at which the price is equal to marginal cost
			E)	5
6			Which of the following conditions means that the competitive firm is maximizing its profits?
			A)	The price equals average revenue.
			B)	The price is equal to marginal revenue.
			C)	The price is equal to marginal cost.
			D)	The price is equal to average cost.
7			What is the shape of the demand curve facing the perfectly competitive firm?
			A)	Downward sloping
			B)	Horizontal
			C)	Vertical
			D)	Upward sloping
8			Which of the following industries provides the best example of a perfectly competitive market?
			A)	Automobile manufacturing
			B)	Restaurants
			C)	Oil refining
			D)	Wheat farming
9			What will happen graphically if firms exit from a perfectly competitive industry?
			A)	The market demand curve will shift to the right.
			B)	The market demand curve will shift to the left.
			C)	The market supply curve will shift to the right.
			D)	The market supply curve will shift to the left.
10			What is the correct interpretation of the perfectly competitive firm's supply curve?
			A)	It is the same as its average variable cost curve.
			B)	It is the same as its total variable cost curve.
			C)	It is the same as the portion of its marginal cost curve that lies above the average variable cost curve.
			D)	It is the same as the portion of its average variable cost curve that lies above the marginal cost curve.

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11			What is the firm's break-even price?
			A)	$60
			B)	$70
			C)	$86
			D)	$200

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12			What is the firm's shutdown price?
			A)	$60
			B)	$70
			C)	$86
			D)	$200