NCERT Solutions Class 12 Economics Perfect Competition. NCERT book for Economics in class 12 is strongly recommened by teachers and the CBSE and NCERT boards. Please download the NCERT solutions for class 12 Economics free in PDF made by teachers of the best schools in India. These solutions are carefully compiled to give detailed understanding of the concepts and also steps of solutions. The NCERT solutions are free to download in pdf format. Please refer to the download link below to download the pdf file and also refer to other chapters and subjects to get the solutions to Economics NCERT book questions and exercises.
Question 1. What are the Characteristics of a perfectly competitive market? [3 Marks]
1. Large number of buyers and sellers
2. Homogeneous product
3. Free entry and exit of firms
4. Perfect knowledge about the market
5. Perfect mobility of factors of production
6. Absence of transportation and selling cost
Question 2. What is price line under perfect competition? [3 Marks]
1. The price line shows the relationship between the market price and a competitive firm’s output level,
2. The vertical height of the price line is equal to the market price as shown in the given figure.
Question 3. What is the relation between market price and average revenue of a price taking firm (i.e. perfectly competitive firm)? [1 Mark]
Answer: The average revenue (AR) of a firm is defined as total revenue per unit of output sold. Let a firm’s output be Q and the market price be P, then TR equals P x Q. Hence, In other words, for a price-taking firm, average revenue equals the market price.
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