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Questions › CUET-PG › CUET-PG 2020 › Q27
4 marks, −1Microeconomics › Perfect competition › Profit maximisation and the competitive firmModerateabout 2 min

CUET-PG 2020 Question 27: Perfect competition

For a firm whose total cost and total revenue functions are given by: TC=mQ+cTC = mQ + cTC=mQ+c, TR=P⋅QTR = P\cdot QTR=P⋅Q, which of the following statements is true?

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For a firm whose total cost and total revenue functions are given by: TC = mQ + c, TR = P· Q, which of the following statements is true? (A) If variable costs per unit (m) increase, the break-even point (Q) will fall (B) If price (P) falls, the break-even point will rise (C) If costs (c) fall, the break-even point will fall (D) If fixed costs (c) rise, the break-even point will be unchanged

Also written as: For a firm whose total cost and total revenue functions are given by: TC = mQ + c, TR = P* Q, which of the following statements is true?

Perfect competition has come up 115 times in 7 exams since 2006.

What this question tests

This question is on Profit maximisation and the competitive firm, part of Perfect competition in Microeconomics.

How a price-taking firm picks output where price equals marginal cost, and when it breaks even or shuts down.

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