SSC CGL Finance – Forms of Market & Price Determination – Level 3 · Challenge
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AR = MR as one horizontal line → price taker under perfect competition.
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SSC CGL Finance – Forms of Market & Price Determination – Level 3 · Challenge – 8 questions, subject: Finance & Economics (Tier II Paper III). Every question has the correct answer with a one-line explanation; tap "Show Answer". Free practice for TNPSC, UPSC, SSC, Bank and RRB exams – Shanmugam IAS Academy, Coimbatore.
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1.
For P = 140 − 4Q with MC = AC = ₹ 20, the deadweight loss of monopoly is:
Correct Answer: C [₹ 450]
Explanation:
Monopoly Q = 15, P = 80; competitive Q = 30.
2.
In the same market the monopolist's profit is:
Correct Answer: A [₹ 900]
Explanation:
Answer: ₹ 900. (80 − 20) × 15 = 900.
3.
Each competitive firm has LAC = q² − 10q + 40. Market demand is Qd = 1000 − 20P. In long-run equilibrium the number of firms is:
Correct Answer: B [140]
Explanation:
Min LAC at q = 5: P = 25 − 50 + 40 = 15.
4.
An oligopolist's demand has a kink at Q = 40, P = ₹ 40: above the kink P = 44 − Q/10, below it P = 60 − Q/2. MC can vary within what range without changing price?
Correct Answer: D [₹ 20 to ₹ 36]
Explanation:
MR just left of kink = 44 − 40/5 = 36; just right = 60 − 40 = 20.
5.
Two Cournot duopolists face P = 150 − Q and each has MC = ₹ 30. The market price is:
Correct Answer: D [₹ 70]
Explanation:
Each produces (150 − 30)/3 = 40 → Q = 80 → P = 70.
6.
True/false countHow many statements are true?
(i) Under perfect competition AR = MR.
(ii) A monopolist's supply curve is its MC curve.
(iii) A cartel is a form of collusive oligopoly.
(iv) Monopsony means one buyer.
(i) Under perfect competition AR = MR.
(ii) A monopolist's supply curve is its MC curve.
(iii) A cartel is a form of collusive oligopoly.
(iv) Monopsony means one buyer.
Correct Answer: B [Three]
Explanation:
(ii) is false: a monopolist has no unique supply curve.
7.
Reverse questionThe Lerner index of a profit-maximising monopolist is 0.2. Price elasticity of demand at its output is:
Correct Answer: C [5]
Explanation:
Answer: 5. L = 1/e → e = 1/0.2 = 5.
8.
Diagram-basedThe revenue curves of a firm are shown. 
The firm is working under:
The firm is working under:
Correct Answer: A [Perfect competition]
Explanation:
AR = MR as one horizontal line → price taker under perfect competition.
➤ Full notes, shortcuts and every answer explained – SSC CGL 2026 Finance & Economics (Tier II Paper III) book (₹149): www.shanmugamiasacademy.in/study-materials/ssc-cgl-finance-economics
📘 SSC CGL 2026 – General Studies – Finance & Economics (Tier II Paper III)
Here you get the answer with a one-line explanation. 1,064 original questions with worked answers · Part A Finance & Accounts and Part B Economics & Governance notes · practice sets + 3 mock tests
Get the book – ₹149 More quizzes
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