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1. The assumptions of perfect competition imply that:

a) Individuals in the market accept the market price as given.

b) Individuals can influence the market price.

c) The price will be fair.

d) The price will be high.

2. Monopolistic competition describes an industry characterized by a ____ number of firms producing____ products with ____ for firms:

a) Small; identical; barriers to entry.

b) Small; similar; relatively easy entry.

c) Large; similar; relatively easy entry.

d) Large; identical; relatively easy entry.

 

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Mahe Alam
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28 Sep 2019

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Related questions

Monopolistic competition is an industry characterized by a:

A. small number of firms producing identical products, with barriers to entry for firms.

B. small number of firms producing similar products, with relatively easy entry for firms.

C. large number of firms producing similar products, with relatively easy entry for firms.

D. large number of firms producing identical products, with relatively easy entry for firms.

Monopolistic competition is an industry characterized by a:

A. small number of firms producing identical products, with barriers to entry for firms

B. small number of firms producing similar products, with relatively easy entry for firms

C. large number of firms producing similar products, with relatively easy entry for firms

D. large number of firms producing identical products, with relatively easy entry for firms

1) A natural monopoly exists when:

a. A few firms collude to make one large firm

b. Firms enter the industry as a result of profit incentives

c. Economies of scale provide large cost advantages to having one firm produce the industry's output

d. Firms naturally maximize regardless of market structure

 

2) A(n) ____ is a single firm with ___, whereas a(n) ___ implies an industry with ____ firm(s) and ____ .

a. Monopoly; barriers to entry; oligopoly; few; no barriers to entry

b. Oligopoly; no barriers to entry; monopoly; many; easy entry and exit

c. Monopoly; barriers to entry; monopolistic competition; many; easy entry and exit

d. Monopolistic competitor; barriers to entry; monopoly; one; barriers to entry

 

3) In monopolistic competition:

a. Each firm produces a product identical to that of every other firm in the industry

b. Firms are aware of their strategic interdependence

c. Firms earn large economic profits in the long run

d. Firms earn zero economic profits in the long run

 

4) A monopolistically competitive industry, such as corn snack chips, and a perfectly competitive industry, like wheat farming, are alike in that:

a. There are many firms in each industry

b. Firms in both types of industries produce similar but not identical products

c. Barriers to entry in both industries are large

d. Firms in both types of industries produce identical products

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