#1
Which of the following is a characteristic of a monopoly market?
Single seller
ExplanationOne firm dominates the market.
#2
In a monopoly market, the demand curve is:
Downward-sloping
ExplanationReflects the inverse relationship between price and quantity demanded.
#3
Which of the following is a characteristic of monopolistic competition?
Product differentiation
ExplanationFirms sell similar but differentiated products.
#4
What is a disadvantage of a monopoly to consumers?
Potential for higher prices and reduced quality
ExplanationConsumers have limited choice and may face higher prices.
#5
What is the main barrier to entry in a monopoly market?
Economies of scale
ExplanationLarge-scale production reduces average costs, making it hard for new firms to compete.
#6
Which of the following is NOT a type of monopoly?
Geographic monopoly
ExplanationThis term doesn't describe a specific type of monopoly.
#7
What is a natural monopoly?
A monopoly that results from economies of scale in production
ExplanationOccurs when one firm can produce at lower costs than multiple firms.
#8
What is a cartel?
A form of oligopoly where firms collude to fix prices and limit production
ExplanationFirms work together to reduce competition and increase profits.
#9
What is price discrimination in a monopoly market?
Charging different prices to different customers based on their willingness to pay
ExplanationAllows firms to capture more consumer surplus.
#10
Which of the following is a strategy used by monopolies to maintain their market power?
Predatory pricing
ExplanationSetting low prices to drive competitors out of the market.