#1
Which of the following is a characteristic of a monopoly?
One firm dominates the market
ExplanationSingle firm control.
#2
What is the primary source of market power for a monopoly?
Economies of scale
ExplanationEfficiency in large-scale production.
#3
What is a characteristic of a perfectly competitive market?
Many buyers and many sellers
ExplanationHigh market competition.
#4
Which of the following is NOT a barrier to entry for monopolies?
Perfect information
ExplanationAvailability of complete information.
#5
What is price discrimination?
Selling identical goods at different prices to different consumers
ExplanationVarying prices based on customer groups.
#6
Which of the following is an example of a natural monopoly?
A local water supply company
ExplanationEssential service in a specific area.
#7
What is a common strategy used by monopolies to maintain their market power?
Engaging in predatory pricing
ExplanationCutting prices to eliminate competition.
#8
What is the term for a market structure with a few firms dominating the market?
Oligopoly
ExplanationSmall group market control.
#9
Which of the following is NOT a characteristic of monopolistic competition?
Price taker
ExplanationAbility to influence prices.
#10
What is a natural monopoly?
A monopoly that arises due to economies of scale
ExplanationResult of efficient large-scale production.
#11
What is the 'deadweight loss' associated with monopoly?
The loss of consumer surplus due to higher prices and lower quantity
ExplanationReduction in consumer welfare.
#12
What is the term for a market with only one buyer and many sellers?
Monopsony
ExplanationSingle buyer market.
#13
What is a cartel?
A group of firms that collude to restrict output and raise prices
ExplanationConcerted effort to control supply and pricing.
#14
What is the term for a market structure in which there is only one seller and many buyers?
Monopoly
ExplanationSole seller dominance.
#15
What is the main difference between monopolistic competition and perfect competition?
Degree of product differentiation
ExplanationExtent of product diversity.