Micro

Forms of Market

Easy

The existence of a large number of buyers and sellers in the perfectly competitive market means?

Only sellers can influence the market by their size.

Individual buyer or seller can influence the market by their size.

Each individual buyer and seller is very large compared to the size of the market.

Each individual buyer and seller is very small compared to the size of the market.

✅ Correct Option: 4

Option 1 -> Incorrect. In perfect competition, neither only sellers nor only buyers can influence the market.

Option 2 -> Incorrect. This describes imperfect competition where individual participants have market power.

Option 3 -> Incorrect. If participants were large relative to the market, they would have the power to influence prices.

Option 4 -> Correct. This is a fundamental characteristic of perfect competition.

Hence, Option 4: Each individual buyer and seller is very small compared to the size of the market -> In a perfectly competitive market, the existence of a large number of buyers and sellers ensures that each participant represents only a tiny fraction of the total market. This means no single buyer or seller has enough market power to influence the equilibrium price through their individual actions. They are all 'price takers' who must accept the market price determined by aggregate supply and demand. This atomistic structure prevents market manipulation and ensures competitive pricing. -> correct

2026: 20 May Shift 1

Identify the correct statements from the following in the context of normal profit and break-even point (BEP).

(A) BEP is the point at which a firm earns only normal profit.

(B) A perfectly competitive firm earns normal profit in long run.

(D) Profit level that keeps a firm in the existing business is called normal profit.

Choose the correct answer from the options given below:

2025: 27 May Shift 2

Public goods, as distinct from private goods, are collectively consumed. Two important features of public goods are:

2026: 13 May Shift 2

Match List-I with List-II

List-I	List-II
(A) Price-takers	(I) Break-even point.
(B) Price less than minimum point of AVC curve	(II) Normal profit.
(C) A firm earns normal profit	(III) Perfectly Competitive Market.
(D) A firm covers the explicit costs and opportunity costs	(IV) Shut down point.

Choose the correct answer from the options given below:

2026: 21 May Shift 1

Which of the following condtion does not exist in a perfectly competitive market?

2025: 29 May Shift 2

In a perfectly competitive market choose the correct statement from the following.

(A) Equilibrium occurs where market demand equals market supply.

(B) Each firm employs labour upto the point where the marginal revenue of labour equals the wage rate.

(D) Equilibrium price is always equal to minimum average cost of the firms.

Choose the correct answer from the options given below:

2025: 22 May Shift 1

Let us consider the example of a market consisting of identical farms producing the same quality of wheat. Suppose the market demand curve and the market supply curve for wheat are given by: qᵈ = 200 - p and qˢ = 120 + p. What is the equilibrium price?

The existence of a large number of buyers and sellers in the perfectly competitive market means?

Solution

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CUET Economics Past Year Questions (Topic-Wise)