#1
Which market structure is characterized by a large number of firms, homogeneous products, and free entry and exit?
Perfect competition
ExplanationCharacterized by many firms selling identical products.
#2
In which market structure does a single firm dominate the entire market with no close substitutes?
Monopoly
ExplanationSingle firm controls the market with no competition.
#3
What is a characteristic of a perfectly competitive market?
Homogeneous products
ExplanationProducts are identical across all sellers.
#4
In a monopolistic competition, firms have some control over prices due to what?
Many close substitutes
ExplanationVariety of similar products allows some price control.
#5
In a perfectly competitive market, what is the shape of the demand curve faced by a firm?
Horizontal
ExplanationDue to identical products, firm faces a horizontal demand curve.
#6
What is a characteristic of monopolistic competition?
There are few firms selling differentiated products
ExplanationMultiple firms offer similar but differentiated products.
#7
Which of the following is a feature of an oligopoly market?
Many firms with differentiated products
ExplanationSmall number of firms selling differentiated products.
#8
What is a characteristic of a monopoly?
A single firm dominates the market
ExplanationOnly one firm controls the entire market.
#9
What market structure exhibits interdependence among firms?
Oligopoly
ExplanationFirms' decisions affect competitors' strategies.
#10
What is a characteristic of a monopolistic competition market?
A large number of firms
ExplanationMany firms offer similar but differentiated products.
#11
What strategy do firms in oligopoly often use to maintain market share?
Collusion
ExplanationFirms cooperate to control prices and market share.
#12
Which market structure tends to result in allocative efficiency?
Perfect competition
ExplanationResources allocated efficiently due to competition.
#13
Which market structure is characterized by mutual interdependence among firms?
Oligopoly
ExplanationFirms' decisions depend on competitors' actions.
#14
Which market structure tends to result in the highest level of market power for individual firms?
Monopoly
ExplanationSingle firm controls the market with significant power.