Match List-I with List-II List-

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Target Exam

CUET

Subject

Economics

Chapter

Micro Economics: Theory of Firms under Perfect Competition

Question:

Match List-I with List-II

List-I	List-II
(A) Perfect Competition	(I) A typical characteristic of perfect competition.
(B) Perfectly elastic demand curve	(II) An individual firm is a price taker.
(C) Degree of price control under perfect competition	(III) The firm can sell any amount of its output at the prevailing price.
(D) Freedom of entry and exit	(IV) No control over price.

Choose the correct answer from the options given below:

Options:

(A)-(IV), (B)-(I), (C)-(II), (D)-(III)

(A)-(IV), (B)-(I), (C)-(III), (D)-(II)

(A)-(II), (B)-(IV), (C)-(I), (D)-(III)

(A)-(II), (B)-(III), (C)-(IV), (D)-(I)

Correct Answer:

(A)-(II), (B)-(III), (C)-(IV), (D)-(I)

Explanation:

The correct answer is Option (4) → (A)-(II), (B)-(III), (C)-(IV), (D)-(I)

(A) Perfect Competition → (II) An individual firm is a price taker. In perfect competition, no single firm can influence the market price. They accept the price set by the market.
(B) Perfectly elastic demand curve → (III) The firm can sell any amount of its output at the prevailing price. Under perfect competition, the demand curve facing an individual firm is perfectly elastic, meaning it can sell any quantity at the given price.
(C) Degree of price control under perfect competition → (IV) No control over price. Firms under perfect competition have zero price control.
(D) Freedom of entry and exit → (I) A typical characteristic of perfect competition. Easy entry and exit of firms is a key feature of a perfectly competitive market.