#1
Which market structure is characterized by a large number of sellers with differentiated products?
Monopolistic competition
ExplanationMany sellers offering varied products.
#2
In an oligopoly, firms tend to compete through?
Non-price competition
ExplanationCompeting on factors other than price.
#3
What is a characteristic of a perfectly competitive market?
Many buyers and sellers
ExplanationAbundance of buyers and sellers with equal market power.
#4
What is a characteristic of a monopoly market structure?
One firm dominating the market
ExplanationA single company controls the entire market.
#5
In a perfectly competitive market, what happens to economic profits in the long run?
Economic profits tend to zero
ExplanationProfits diminish over time due to competition.
#6
Which of the following is a characteristic of a monopoly?
High barriers to entry
ExplanationDifficulties for new competitors to enter.
#7
What is a pricing strategy where a product is initially offered at a very low price to capture a large market share?
Penetration pricing
ExplanationStarting with low prices to attract customers.
#8
Which market structure has the highest degree of control over the price of the product?
Monopoly
ExplanationSingle firm dominance allows for price control.
#9
What is a characteristic feature of monopolistic competition?
Large number of sellers
ExplanationNumerous sellers with differentiated products.
#10
What characteristic feature distinguishes monopolistic competition from perfect competition?
Product differentiation
ExplanationOffering unique products to differentiate.
#11
In which market structure do firms face a downward-sloping demand curve?
Monopolistic competition
ExplanationDemand decreases as prices rise due to product differentiation.
#12
In monopolistic competition, firms have a degree of market power due to?
Product differentiation
ExplanationUnique products give firms some control over pricing.