[amp_mcq option1=”perfect competition” option2=”cut-throat competition” option3=”monopoly” option4=”monopsony” correct=”option1″]<\/p>\n
The correct answer is: A. perfect competition.<\/p>\n
In perfect competition, there are many firms producing identical products, and each firm is a price taker. This means that each firm has no control over the price of its product, and must accept the market price. As a result, firms in perfect competition will produce at the point where marginal cost equals marginal revenue. This point is characterized by excess capacity, as firms produce less than the output that would minimize average cost.<\/p>\n
Cut-throat competition is a type of competition in which firms engage in aggressive pricing strategies in an attempt to gain market share. This can lead to lower prices for consumers, but it can also lead to lower profits for firms and even bankruptcies.<\/p>\n
A monopoly is a market structure in which there is only one firm producing a good or service. The monopolist has a great deal of market power, and can therefore charge a higher price than would be possible in a competitive market. This leads to a lower output and higher prices for consumers.<\/p>\n
A monopsony is a market structure in which there is only one buyer of a good or service. The monopsonist has a great deal of market power, and can therefore pay a lower price than would be possible in a competitive market. This leads to a lower output and lower prices for producers.<\/p>\n","protected":false},"excerpt":{"rendered":"
[amp_mcq option1=”perfect competition” option2=”cut-throat competition” option3=”monopoly” option4=”monopsony” correct=”option1″]<\/p>\n","protected":false},"author":1,"featured_media":0,"comment_status":"closed","ping_status":"open","sticky":false,"template":"","format":"standard","meta":{"footnotes":""},"categories":[12],"tags":[],"class_list":["post-52955","post","type-post","status-publish","format-standard","hentry","category-economics","no-featured-image-padding"],"yoast_head":"\n