#1
Which of the following is a characteristic of a perfectly competitive market?
Many buyers and many sellers
ExplanationLarge number of buyers and sellers
#2
Which market structure is characterized by a single seller with significant control over price?
Monopoly
ExplanationSingle seller with price control
#3
Which of the following is NOT a determinant of supply?
Consumer preferences
ExplanationConsumer choices' impact on supply
#4
What is the law of demand?
As the price of a good increases, the quantity demanded decreases
ExplanationInverse relationship between price and demand
#5
What is the primary goal of a profit-maximizing firm?
Maximize total profit
ExplanationOptimizing overall profit
#6
What does the term 'price floor' refer to in economics?
A minimum price set by the government
ExplanationGovernment-set minimum price
#7
What does the term 'elasticity of demand' measure?
The responsiveness of quantity demanded to changes in price
ExplanationHow demand changes with price changes
#8
In monopolistic competition, firms differentiate their products in order to:
Increase market power
ExplanationEnhance their market influence
#9
What is price discrimination?
Charging different prices to different customers for the same product
ExplanationVarying prices for same product
#10
What is the formula for calculating price elasticity of demand?
Percentage change in price / Percentage change in quantity demanded
ExplanationFormula for demand elasticity
#11
Which of the following is a characteristic of monopolistic competition?
Limited product differentiation
ExplanationPartial product uniqueness
#12
Which of the following is a characteristic of oligopoly?
Firms have significant market power
ExplanationDominant market influence
#13
What is the 'invisible hand' concept in economics often associated with?
Adam Smith
ExplanationAdam Smith's economic concept
#14
Which of the following is an example of a perfectly inelastic demand?
Gasoline in the short run
ExplanationConstant demand despite price changes
#15
What is the main characteristic of a cartel?
Firms colluding to restrict output and raise prices
ExplanationCollusion for price control