Skip to content

Course home

Sign up

Market structures

EasyMediumHard
12345678910111213
Question 12

A firm operating in a perfectly competitive market is a price taker, with the market price of its product set at P=£48P = £48P=£48. The firm's total cost function is:

TC=2q2+8q+72 TC = 2q^2 + 8q + 72 TC=2q2+8q+72

where q q\,q represents the quantity of output.

Which of the following options correctly identifies the levels of output q q\,q at which the firm achieves allocative efficiency and productive efficiency?

A

Allocative efficiency at q=10q = 10q=10; productive efficiency at q=6q = 6q=6

B

Allocative efficiency at q=6q = 6q=6; productive efficiency at q=10q = 10q=10

C

Allocative efficiency at q=18q = 18q=18; productive efficiency at q=6q = 6q=6

D

Allocative efficiency at q=20q = 20q=20; productive efficiency at q=6q = 6q=6

Markscheme

Market structures Questions

  1. A Level
  2. /Economics
  3. /Market structures

42 exam-style questions on OCR A Level Economics Market structures, covering Perfect competition, Monopoly, Monopolistic competition, Oligopoly, and Contestable markets. Each one has a worked solution and a mark scheme showing where the marks go.

Question bank