HomeTestsSearchRankProfile
mediumMCQSSC CGL2026Economics
1 mark

In perfect competition a firm maximizes profit by ________.

  1. A
    setting price such that price is equal to or greater than its marginal costs
  2. B
    setting output such that price equals average total costs
  3. C
    setting output such that price equals marginal costs
  4. D
    setting price so that it is greater than marginal cost

Solution & Step-by-step Explanation

Under perfect competition, a firm is a price taker. It maximizes its profit by choosing an output level where Price (P) equals Marginal Cost (MC).

Practice this question

Try it yourself before checking the explanation above.

In perfect competition a firm maximizes profit by ________.
A
setting price such that price is equal to or greater than its marginal costs
B
setting output such that price equals average total costs
C
setting output such that price equals marginal costs
D
setting price so that it is greater than marginal cost

Share This Question

MicroeconomicsMarket StructuresProfit Maximization

Related Questions

easyMCQ

Which one of the following statements is true?

easyMCQ

Which of the following statements is not correct?

easyMCQ

Which one of the following statements is correct?

easyMCQ

The product formed by the reaction of an aldehyde with a primary amine is:

easyMCQ

Which part of the tobacco plant is infected by Meloidogyne incognita?

easyMCQ

The term ecosystem was coined by:

Ready for a Full Test?

Practice with timed mock tests and track your performance across Economics.

Browse TestsLeaderboard

Discussion