#1
Which of the following is a characteristic of perfect competition?
Homogeneous products
ExplanationProducts are identical across firms.
#2
Which market structure is characterized by a single seller with significant control over price?
Monopoly
ExplanationOne seller dominates the market, setting prices.
#3
Which market structure typically results in the highest level of product differentiation?
Monopolistic competition
ExplanationFirms differentiate their products to compete in the market.
#4
Which market structure is most likely to result in allocative efficiency?
Perfect competition
ExplanationOptimal allocation of resources due to competitive pressures.
#5
Which market structure is characterized by a large number of firms producing homogeneous products?
Perfect competition
ExplanationMany firms offering identical products with no differentiation.
#6
In monopolistic competition, firms have:
Significant control over prices
ExplanationFirms can set prices to some extent due to product differentiation.
#7
Which of the following is an example of an oligopoly?
Fast food industry
ExplanationA few major players dominate the market.
#8
In a duopoly, how many firms dominate the market?
Two
ExplanationThere are only two dominant firms in the market.
#9
What is a key feature of monopolistic competition?
Some degree of market power
ExplanationFirms have the ability to influence prices.
#10
Which of the following is an example of a monopolistic competition market?
Cell phone service providers
ExplanationDifferent firms provide similar but slightly differentiated services.
#11
What is a characteristic of an oligopoly?
A few large firms dominating the market
ExplanationMarket domination by a small number of large firms.
#12
What is a characteristic of a natural monopoly?
High fixed costs and low marginal costs
ExplanationLarge upfront costs but low costs for each additional unit.
#13
What market structure exhibits strategic interdependence among firms?
Oligopoly
ExplanationFirms' actions are heavily influenced by competitors' decisions.
#14
What is a characteristic of a contestable market?
Low sunk costs
ExplanationMinimal barriers to entry and exit in the market.
#15
In which market structure do firms have the least control over price?
Perfect competition
ExplanationPrices are determined solely by market forces.
#16
What is a characteristic of a monopolistic market?
Few large firms dominating the market
ExplanationMarket controlled by a small number of firms.