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Contents
1 MARKET STRUCTURES . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 2
1.1 MARKET STRUCTURES . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 2
1. MARKET STRUCTURES
NARAYAN CHANGDER
1.1 MARKET STRUCTURES
1. If Nike and Adidas merge, it would be a 4. This market structure occurs when an in-
merger dustry has many businesses selling the
A. horizontal same product
A. Monopoly
B. vertical
B. Oligopoly
C. insane
C. Monopolistic Competition
D. ladder
D. Perfect Competition
2. What is market structure?
5. Which of the following is NOT true about
A. How different industries are classified monopolies?
and differentiated based on their degree
and nature of competition for goods and A. They have very limited political influ-
services ence
B. Place where parties can gather to fa- B. They can become inefficient
cilitate exchange C. They can lose money and be unprof-
itable
C. The arrangement of and relations be-
tween the parts or elements of something D. They may fail to innovate
complex.
6. When buying produce at the grocery store,
D. How different markets are build from many people shop around for the best deal,
start to finish. because when it comes down to it, an ap-
ple is an apple. This is an example of:
3. A barrier to entry is any obstacle that
makes it difficult for a new firm to enter a A. monopoly
market. B. monopolistic competition
A. TRUE C. oligopoly
B. FALSE D. perfect competition
1. A 2. A 3. A 4. D 5. A 6. D
1.1 MARKET STRUCTURES 3
7. Why does the US government allow tech- 12. Jeans

nological monopolies by protecting patents A. Oligopoly
and copyrights?

B. Monopoly
A. To help the wealthy stay on top
C. Perfect Competition
B. To promote innovation
D. none of above
C. To create technological monopolies
D. To promote perfect competition 13. Which market structure has only one pro-
ducer?
8. If a firm in a perfectly competitive mar- A. oligopoly
ket chooses its profit-maximizing quan-
B. monopoly
tity, which of the following MUST be true?
C. perfect competition
A. MR > MC
D. monopolistic competition
B. P = MC
C. MR < P 14. Products that are identical are called
D. MC > ATC A. Cartels
E. a. P > ATC B. Commodities
C. Collusions
9. How are people’s inventions protected?
D. Capital
A. Copyrights
B. Public franchise 15. Which market structure involves selling
“similar” products and only has a FEW
C. Patents firms?
D. Seals A. Perfect Competition
10. A business owner who prefers to maintain B. Monopoly
complete control of all business activities C. Oligopoly
might consider structuring the business as
D. Monopolistic Competition
a(n)
A. sole proprietorship 16. Business decision to combine resources,
ideas, and innovation
B. franchise
A. Merger
C. general partnership.
B. Trust
D. corporation.
C. Collusion
11. Some economists call an industry a(n)
D. Cartel
if the four largest businesses produce at
least 70-80% of the output. This is a mar- 17. Ethan, Lily, and Noah are playing a game
ket controlled by a few. of ‘Market Masters’. They are discussing
A. oligopoly about different market structures. Can
you help them identify which market struc-
B. monopoly ture has a large number of buyers and sell-
C. pure competition ers?
D. monopolistic competition A. Monopolistic Competition
7. B 8. B 9. C 10. A 11. A 12. C 13. B 14. B 15. C 16. A 17. B

B. Perfect Competition 21. A market structure in which one firm has

a monopoly because of its location is a
C. Oligopoly
A. natural monopoly.
D. Monopoly
B. geographic monopoly.
18. Price fixing and collusion often occur in this C. technological monopoly.
type of market structure
D. government monopoly.
A. monopoly
NARAYAN CHANGDER
B. oligopoly 22. Which one IS one of the 4 market struc-
tures?
A. Market Economy
B. Sole Proprietorship
19. -One seller-Complete barriers to market C. Monopolistic Competition
entry-No product differentiation, Which of D. Corporation
the following is described by the character-
istics listed above? 23. What is a monopsony?
A. Monopoly A. Many buyers, one seller
B. Oligopoly B. Many buyers & sellers
C. Pure competition C. Few buyers, many sellers
D. Monopolistic competition D. One buyer & seller
20. Suppose the market price of the product 24. A primary reason for government regula-
jumped from P2 to P4, to maximize pro- tion is to protect consumers.
duction the firm would A. True
B. False
25. Slight control over prices, affordable

prices, but can be somewhat higher be-
cause of nonprice competition-they com-
pete for customers this way, production
is slightly below equilibrium, efficient pro-
duction and companies, small profit!
A. increase production and earn an eco- A. Monopoly
nomic profit.
B. Oligopoly
B. not change production and earn nor-
mal profit.
C. increase production and incur an eco-
nomic loss. 26. Which market structure has a large num-
D. not change production and incur an ber of buyers and sellers (the most) and
economic loss. products are identical?
E. not change production and earn eco- A. perfect (pure) competition

nomic profit. B. monopolistic competition
18. B 19. A 20. A 21. B 22. C 23. C 24. A 25. C 26. A 27. A
C. oligopoly 33. A monopolistically competitive firm will

D. monopoly profit maximize using the marginal princi-
ple much like a(n)

27. Mergers are regulated by the government A. monopoly
in order to keep trusts from forming.
B. perfectly competitive firm
A. True
C. oligopoly
B. False
D. none of above
28. What is not part of perfect competition? 34. a market structure that does not meet the
A. buyer/ seller are well informed conditions of perfect competition
B. sellers cannot enter/ exit market eas- A. imperfect competition
ily B. pure competition
C. low prices C. market place
D. few barriers of entry D. oligopoly
29. Term for costs that change with production 35. In order to shop at a cooperative, you must
A. Fixed Cost be
B. Average Cost A. a member
C. Variable Cost B. a retired veteran

C. interviewed and hired
D. Marginal Cost
D. financially stable
30. In the long run, the PERFECT COMPETI-
TION market will experience 36. Why is economics regarded as social sci-
ence?
A. supernormal profit
A. it is developed by humans
B. normal profit
B. it formulates theories for societies
C. economic profit
C. it explains demand and supply
D. economic loss
D. it studies human behaviour
31. Which of the following antitrust laws was
37. Legal maximum that can be charged for a
first enacted?
good.
A. Federal Trade Commission Act
A. price ceiling
B. Clayton Antitrust Act B. excess demand
C. Sherman Antitrust Act C. equilibrium
D. Robinson-Patman Act D. disequilibrium
32. What is a monopoly market structure? 38. One Seller, Unique product
A. theoretical condition A. Perfect Competition
B. small firms B. Monopolistic Compeition
C. single seller, selling a unique product. C. Oligopoly
D. large buyers and sellers D. Monopoly
28. B 29. C 30. B 31. C 32. C 33. A 34. A 35. A 36. D 37. A 38. D 39. C
39. What is the market demand curve for a A. more sensitive to political considera-
monopoly firm? tions.
A. Horizontal B. under the control of the Federal Re-
serve System.
B. Upward sloping
C. more time-consuming to implement.
C. Downward sloping
D. related to tax increases and de-
D. Vertical creases.
NARAYAN CHANGDER
40. MONOPOLY would likely produce the 45. Which of the following is NOT true about
good/product at a perfectly competitive market?
A. cost-saving measure A. many firms
B. decreasing long-run average cost B. identical product
(LRAC) C. price maker
C. increasing long-run average cost D. price taker
(LRAC)
46. Imagine Oliver, Noah, and Olivia are run-
D. none of above ning lemonade stands in a neighborhood (a
Perfectly Competitive Market). What hap-
41. A single seller controls the supply of a
pens when new kids start their own lemon-
good or service
ade stands in the same neighborhood?
A. Perfect Competition A. All of the above
B. Monopolistic Competition B. Oliver, Noah, and Olivia’s customer
C. Oligopoly base (demand) decreases
D. Pure Monopoly C. The price of lemonade in the neighbor-
hood decreases
42. Which of these market structures has the D. The total number of lemonade stands
least control over price in the market- (market supply) in the neighborhood in-
place? creases
A. Perfect Competition
47. What is the main feature of an oligopoly
B. Monopolistic Competition market?
C. Oligopoly A. Few large firms dominating the market
D. Monopoly B. No competition in the market
C. One firm dominating the market
43. Market structure characterized by a single
producer in a market D. Many small firms dominating the mar-
ket
A. Oligopoly
48. State where wildfires are ravaging com-
B. Purely Competitive
munities.
C. Monopoly A. California
D. Monopolistic competition B. Pennsylvania
44. Monetary policy differs from fiscal policy C. Virginia
in that monetary policy is D. Scotland
40. A 40. B 41. D 42. A 43. C 44. B 45. C 46. A 47. A 48. A 49. A
49. forms when barriers prevent firms from 54. an advantage of better service and conve-
entering a market that has a single sup- nient store hours
plier

A. price competition
A. Monopoly
B. customer service
B. Government Monopoly
C. nonprice competition
C. Natural Monopoly
D. Oligopoly D. pure competition
50. when a lower price is the main reason for 55. Which type of monopoly is allowed to ex-
customers to buy from one business over ist because they keep the average cost per
another customer low?
A. price war A. Natural Monopoly
B. price competition
B. Geographic Monopoly
C. Government Monopoly
D. all of these answers
D. Technological Monopoly
51. When companies that form on oligopoly co-
operate together to set or fix prices at a 56. The term used for costs that change with
given level, they are engaging in the number of output
A. Fixed Cost
B. Average Cost
C. Variable Cost
D. Marginal Cost
A. Monopoly 57. Coke and Pepsi are part of what market

B. Vertical Integration structure?
C. Collusion A. Monopoly
D. none of above B. Oligopoly
52. Example:minimum wage C. Monopolistic Competition
A. price ceiling D. Perfect Competition
B. price floor
58. Which of the following is most likely an
53. In monopolistic competition: example of a monopoly?
A. Firms face a perfectly elastic demand
A. A Starbucks across from Dunkin
curve
Donuts
B. All products are homogeneous
B. A gas station in the country by itself
C. Firms make normal profits in the long
run C. 3 fast food restaurants all on the same
street
D. There are barriers to entry to prevent
entry D. A Kroger 4 miles away from a Walmart
50. B 51. C 52. B 53. C 54. C 55. A 56. C 57. B 58. B 59. B
59. What is the market structure of Pepsi and B. DISNEYLAND

Coke?
C. (USPS) UNITED STATES POSTAL SER-
A. monopoly VICE
B. oligopoly D. BEN AND JERRY’S
C. monopolistic competition
65. The difference between a firm’s total rev-
D. perfect competition enue and its total opportunity cost is the
firm’s
NARAYAN CHANGDER
60. In a Perfect Competition, products are ba-
sically A. marginal revenue
A. differentiated B. economic profit
B. identical C. marginal profit
C. similar D. normal profit
D. opposite
66. What company has the lowest percentage
61. Which of the following applies to both mo- of business in the U.S?
nopolistic competition and perfect competi-
A. sole proprietorship
tion?
A. differentiated products B. corporations
B. long-run zero economic profits C. multinationals

C. price setter D. partnerships
D. productive inefficiency 67. Owners of a corporation are known as ,
62. What IS an advantage of a sole proprietor- each of whom faces only limited liability
ship? for the firm’s debts, which is the value of
their stock.
A. Shares can be sold to raise capital
(money)
B. Decisions are responsibilities can be
shared
C. The owner has independence
D. It is hard to start up A. Limited Liability Partnership
63. Which of the following is not a type of im- B. Stockholders
perfect competition C. Partners
A. Monopolistic D. Sole Proprietors
B. Oligopoly
68. What are the conditions for perfect compe-
C. Monopoly
tition?
D. Pure
A. Only a few buyers and sellers
64. AN EXAMPLE OF A GOVERNMENT B. 1. Many buyers and sellers2. Identical
MONOPOLY products3. Informed buyers and sellers4.
A. FIESTA TEXAS Free market entry and exit
60. B 61. B 62. C 63. D 64. C 65. B 66. D 67. B 68. B 69. B
69. What are the names of the two ways in B. Oligopoly

which the government influences the busi- C. Monopolistic competition
ness cycle?

D. Perfect competition
A. Supply and Demand
75. Which of the following basically sets up
B. Monetary Policy and Fiscal Policy mini monopolies?
C. Surplus and Shortage A. Price fixing
D. Expansion and Contraction B. Market allocation
70. Why does the government place price ceil- C. Predatory pricing
ings on some “essential” goods? D. Competitive pricing
A. to prevent inflation during to reduce 76. On which continent is the Sahara desert?
supply for these goods
A. Asia
B. to keep business people from making B. Africa
large profits
C. America
C. to keep the goods from becoming too
D. Europe
expensive
D. to reduce demand for these goods 77. A group of independent enterprises that
work together to restrain competition by
71. Makari and Jenna are discussing the bene- controlling prices and fixing production
fits of a sole proprietorship. Which might quotas are known as
you hear them say?
A. unlimited liability
B. long lasting life
C. dividends
D. keeping all the profits
72. Which of the following is an advantage of A. Collusion

a sole proprietorship? B. Antitrust laws
A. Easy to discontinue C. Franchises
B. Unlimited liability D. Cartels
C. Lack of permanence 78. Imagine David, Nora, and Ava are play-
D. Limited access to resources ing a game of ‘Market Masters’. In this
game, they each own a business in a mar-
73. Not-for-Profit Corporations have to pay ket structure known as ‘monopolistic com-
taxes. petition’. Can you tell what this means?
A. True A. It means David, Nora, and Ava are the
B. False only firms selling a unique product in the
market
74. Only one seller sells a product for which B. It means David, Nora, and Ava are
there are no close substitutes among many firms selling differentiated
A. Monopoly products in the market
70. C 71. D 72. A 73. B 74. A 75. B 76. B 77. D 78. B

C. It means David, Nora, and Ava are B. Monopoly

among a few firms selling identical prod- C. Perfect Competition
ucts in the market
D. none of above
D. It means there is no competition in the
market where David, Nora, and Ava are 83. In Game Theory:
doing business A. Firms are always assumed to act inde-
79. This can result if the government limits pendently
how much of an item you can get so ev- B. Firms are always assumed to cooper-
NARAYAN CHANGDER
eryone gets a little. ate with each other
A. rationing C. Firms always collude as part of a car-
B. supply tel
C. origination D. Firms consider the actions of others

before deciding what to do
D. Los Angeles Lakers
84. Cooperation between two or more par-
80. Which of the following is true of a monop- ties to limit competition. The parties may
olistically competitive market? agree to divide a market, set prices, etc.
A. There are only a few large firms in the A. anti-trust
market and all produce identical products.
B. collusion
B. There is one large firm in the market
C. oligopoly
and it sells a product with no close substi-
tutes. D. monopoly
C. There are a huge number of firms sell- 85. Which of the following are true?
ing identical products at the same price.
D. There are many firms but each sells a
product that is slightly different than its
competitors’ products
E. Firms are price takers and spend very
little, if at all, on advertising.
81. The ways in which the competitors try to

gain new customers in a Monopolistic Com-
petition is by
A. showing their product is superior A. For this firm to operate, Price must be
B. using famous spokespeople to en- above avc
dorse their product B. This firm is operating in an economic
C. better prices loss, so it should shut down
D. getting the gov’t to put competitors out C. In the short run, supply will decrease
of business because firms will exit the industry be-
cause loss pushes firms out
82. A market structure in which only a few D. In the long run, supply will decrease
sellers offer a similar product because firms will exit the industry be-
A. Oligopoly cause loss pushes firms out
79. A 80. D 81. A 81. B 82. A 83. D 84. B 85. A 85. D

E. This firm is earning an economic profit, 90. Which of the following markets is an ex-
so firms will enter and profits will return ample of an oligopoly?
to normal

A. Farmers
86. Government document granting an inven- B. Electronics
tor the right to produce, use, or sell an in- C. Airline industry
vention exclusively for a limited period of
time. D. Book stores
A. Zoning 91. The profit-maximizing rule is that a firm

will maximize profits:MC = MR
B. Patent
A. True
C. Collusion
B. False
D. Anti-Trust
92. What is a monopoly?
87. What is the total revenue at the profit-
maximizing quantity? A. A monopoly is a market structure in
which a single company or entity has ex-
clusive control over a particular product
or service in a specific market.
B. A monopoly is a type of market struc-
ture where multiple companies compete
for control over a particular product or
service.
C. A monopoly is a government program
that provides financial assistance to low-
A. $50 income individuals.
B. $30 D. A monopoly is a type of board game

where players buy and trade properties to
C. $56 try to bankrupt each other.
D. $36
93. A monopolist is
E. $15
A. a price taker
88. The barriers to entry in a monopoly are B. able to ignore the demand for its prod-
very low/easy entry uct when setting price
A. False C. able to set the price for its product
B. True D. able to earn only a normal profit in the
long run
89. is achieved when quantity demanded
and quantity supplied are equal. 94. Market structure where it is very difficult
or impossible to enter because the money
A. surplus
required is too large or because of laws
B. shortage that protect this product.
C. equilibrium A. Perfect Competition
D. subsidy B. Oligopoly
86. B 87. A 88. A 89. C 90. C 91. A 92. A 93. C 94. D

C. Monopolistic Competition 100. Which of the following is the BEST ex-

planation for government regulation of the
D. Monopoly
public utilities market?
95. Which of the following would cause the de- A. The isolated location makes it impossi-
mand curve to shift to the right? ble for any other providers of utilities to
A. a popular toys loses appeal compete
B. Suppliers expect higher prices in the B. It is most efficient to allow only one
supplier of electricity or water because of
NARAYAN CHANGDER
future
economies of scale
C. price of a substitute good decreases
C. Providing utilities is not attractive to
D. the average annual income increases private companies because of limited op-
portunities to make a profit
96. An example of imperfect competition is
when D. The government wishes to reward the
technological innovation of the utilities
A. A book seller freely exits the market providers with limited competition
B. A farmer sells eggs, fruits, and vegeta-
bles 101. In monopoly, the firm is the industry
C. Buyers receive enough information to A. TRUE

make educated buying choices B. FALSE
D. Ice cream sellers join together to influ-
ence the price of ice cream sundaes 102. What is the equilibrium price point on this
graph?
97. agreement by a formal organization of pro-
ducers to coordinate prices and production
A. Collusion
B. Cartel
98. Which of the following is NOT a Market

Structure?
A. Perfect Competition A. $1
B. Oligopoly B. $2
C. Monopoly C. $3
D. Corporation D. $4
99. What must be true to reach profit maxi- 103. Which market structure(s) have many
mization? producers. Select all that apply.
A. MC > MR A. Perfect Competition
B. MR > MC B. Monopolistic Competition
C. MR < MC C. Oligopoly
D. MC = MR D. Monopoly
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104. is an establishment formed to carry 109. Public or Private?

on commercial enterprise.

A. Perfect Competition A. Public
B. Monopolistic Competition B. Private
C. Oligopoly 110. The break-even point (BEP) is obtained
D. Business Organization when TR>TC
105. What are barriers to entry? A. True
A. Factors that make it difficult for a new B. False

firm to enter a market. 111. Which two market structures use non-
B. An illegal agreement among firms to price competition (use of advertising) the
divide the market, set prices, or limit pro- most?
duction. A. monopoly and perfect competition
C. A market for a good or service where B. monopolistic competition and
there is only one supplier. oligopoly
D. A market in which there are many buy- C. pure competition and monopoly
ers and many sellers of an identical prod-
uct. D. pure monopoly and geographic
monopoly
106. highest barriers to entry
112. If the government wishes for a monopoly
A. monopoly
to breakeven, the price should be set at
B. oligopoly
107. SSEMI3 What is the greatest advantage
of a sole proprietorship?
A. All profit go to the single owner
B. Easy to start
C. Makes all decisions
D. none of the above
108. .... exists where there is only one firm in
the market. A. $18
A. Pure monopoly B. $8
B. Natural monopoly C. $7
C. Monopoly D. $6
D. Monopsons E. $3

113. follows these conditions:many sellers;

low barriers to enter market; slight con-
trol over price; differentiated products
A. perfect competition
B. monopolistic competition
C. oligopoly
D. monopoly
NARAYAN CHANGDER
A. A franchise
114. Cereal producers are a good example of B. A patent / copyright
which type of market structure?
C. Natural monopoly
A. Perfect competition
D. Resource monopoly
B. Monopoly
118. Boeing and Airbus are in a duopoly that
C. Monopolistic competition has reached the monopoly outcome. Boe-
D. Oligopoly ing increases it’s production. If Airbus in-
creases its production, it’s profits will
115. MANY COMPANIES COMPETE IN AN and Boeing’s profits will
OPEN MARKET TO SELL PRODUCTS THAT
ARE SIMILAR BUT NOT IDENTICAL
A. OLIGOPOLY
B. MONOPOLY
C. PERFECT COMPETITION
D. MONOPOLISTIC COMPETITION
A. increases; decreases
116. Mark has just hired a new employee and
B. increases; decreases
his output has increased from 105 to 119.
His marginal cost was $4.19 but his rev- C. decreases; decreases
enue was $18. What should mark do? D. increases; does not change
A. Keep the amount of employees he has E. decreases; increases
since he is making a profit.
119. When there is only one seller of a good
B. Fire his new employee due to the new or service, they are said to have a?
marginal cost being to high.
A. Monopoly
C. Hire more employees until marginal
cost equals marginal revenue B. Oligarchy
D. Fire several employees to keep produc-
tion costs down D. Perfect Competition
117. Uncle Booger has a special license to be 120. What happens to the market price when
the only producer of the Bumper Dumper. new firms enter the industry?
This type of legal monopoly is known as: A. The market price remains the same

B. The market price increases 125. When consumers are divided into groups
and charged differently it is called
C. The market price decreases

A. Franchise
D. The market price fluctuates
B. Monopoly
121. Describe the impact of market power on C. Price discrimination
consumer choice and prices.
D. Making a profit
A. Market power allows firms to influ-
ence consumer choice and prices by lim- 126. NPF-Increase in personal tax rates.
iting competition and controlling supply. What curve is impacted in the TV market
B. Market power only affects consumer and how?
choice, not prices A. Demand Left
C. Market power leads to increased com- B. Demand Right
petition and lower prices
C. Supply Left
D. Market power has no impact on con- D. Supply Right
sumer choice and prices
127. In this business organization, a major ad-
122. True or False:Countries try lower taxes vantage is the product is well known and
on multi-national companies with the has national advertising.
hopes of having them build business in
their land. A. corporation
A. True B. partnership
B. False C. franchise
D. sole proprietorship
123. An is a market structure character-
ized by only a few sellers of a prod- 128. Why do cartels NOT last?
uct who dominate the market. (Exam- A. illegal
ples:breakfast cereals and natural gas)
B. members have to keep agreement
A. cartel
C. they lose money
B. monopoly
D. products are competitive
129. Explain the concept of interdependence in
D. oligopoly
an oligopoly market.
124. Which type of monopoly is allowed to ex- A. Interdependence means each firm op-
ist because they are the only company in erates independently without any impact
an area that is willing and capable of pro- on other firms
ducing? B. Interdependence is the concept of
A. Natural Monopoly firms in a market not being affected by the
actions of other firms
C. Interdependence refers to the situa-
tion where firms collude to fix prices and
D. Technological Monopoly output

D. Interdependence refers to the situa- 133. What is the difference between perfect
tion where the actions of one firm directly competition and monopolistic competition?
affect the performance and decisions of A. Perfect competition involves differen-
other firms in the market. tiated products and no control over price,
while monopolistic competition involves
130. When there is a shortage the price will
identical products and some control over
usually?
price.
B. Perfect competition involves differen-
NARAYAN CHANGDER
tiated products and some control over
price, while monopolistic competition in-
volves identical products and no control
over price.
C. Perfect competition involves identical
products and some control over price,
while monopolistic competition involves
A. rise differentiated products and no control
B. fall over price.
C. remain the same D. The main difference is that perfect
competition involves identical products
D. equilibrium
and no control over price, while monop-
131. How much influence one company have olistic competition involves differentiated
over the price of the product in the market products and some control over price.
is called what? tagsSSEMI3
A. Price Taker 134. Advertising and innovation are non-price

competition strategies most common in
B. Market Control
perfect competition markets.
C. Degree of Influence
A. TRUE
D. Making profit
B. FALSE
132. Which of the following is an advantage
135. Trent is opening a shoe store. He needs
of a partnership?
money to rent a retail space, buy shoes
to stock in the store, pay employees, and
make advertisements. These are exam-
ples of
A. Barriers to entry
A. they are hard to start B. Start-up costs
B. management is hard between two or C. Corporate taxes
more people
D. Opportunity costs
C. partnerships can usually attract finan-
cial capital more easily than proprietor- 136. A government issued right to operate a
ships. business
D. They are inefficient. A. license

B. copyright 141. What area represents producer surplus in

C. patent the graph shown here if this market is in
equilibrium?

D. registered trademark
137. A condition of a Monopolistic Competitive

market is that products are similar but not
identical.
A. True
B. False
C. It depends on the product.
D. none of above
138. In the short run, when MONOPOLIS-

TIC COMPETITON experiences economic A. P2MP0
profit, B. P4MP2
A. existing firms in the monopolistic com- C. LMN
petition will exit
D. P4PLN
B. new firms will enter the market
E. P0MP4
139. SSEMI3 If a business fails to meet its fi-
nancial obligations, the owner (or owners) 142. How many firms are there in a perfect
are personally responsible for those debts. competition?
A. unlimited liability A. 1
B. limited liability B. 2-5
C. contract C. Many
D. articles of partnership D. none of above
140. A type of business organization in which
143. How might an oligopoly control prices?
all partners are limited partners and are
protected from personal liability in certain A. Collusion
situations is known as a B. Price leadership
C. Nonprice competition
D. All of the above
144. Which type of market structure is the

corn industry?
A. Limited Liability Partnership A. perfect competition
B. Business Organization B. monopolistic competition

C. General Partnership C. oligopoly
D. Government Monopoly D. monopoly

145. Extra cost of producing one more unit 151. Which of the following is not a character-
istic of an oligopoly?
A. Marginal cost
A. many sellers
B. Variable Cost
B. not as much competition-firms have
C. Fixed Cost some control over prices
D. Average Cost C. lots of advertising
146. Monopoly is characterised by D. many barriers to entry
NARAYAN CHANGDER
A. Only one firm. No substitutes. The firm 152. Restrictions on the entry of a new firm
is a price maker. into an industry
B. Only one firm. No substitutes. The A. Monopoly
firm is a price taker. B. Oligopoly
147. Which market structure has no control C. Monopolistic Competition
over price? D. Perfect Competition
A. Perfect Competition E. Barriers to entry
B. Monopolistic Competition 153. If this monopoly were to price discrimi-
C. Monopoly nate, what quantity would be produced?
D. Oligopoly
148. OPEC is an example of a

A. natural monopoly
C. cartel
D. patent
149. Which of the following is not a type of A. M

legal monopoly? B. N
A. Natural monopoly C. Q
B. Geographic monopoly D. R
C. Government monopoly E. Indeterminate
D. Standard Oil 154. Government regulations to keep competi-
tion fair and protect consumers change the
150. An industry described as a monopolistic economic system from a market system to
competition would have most likely have a:
A. similar but differentiated products A. modified free market economy
B. normal profits in the long run B. command economy
C. one firm with no close rivals C. traditional economy
D. no opportunities of collusive behavior D. none of above

155. Limited Liability means that stockholders 161. Which of the following is the definition
can lose their investment if the corporation forPartnership?
fails.

A. True
B. False
156. Imagine a product in which consumers
would purchase it regardless of the price. A. business investment that involves rent-
Whether it be $5 or $500 they would con- ing or leasing another successful busi-
tinue to purchase it. How would you de- ness model
scribe the demand for this product?
B. unincorporated business owned and
A. perfectly inelastic run by a single person who has rights to all
B. perfectly competitive profits and unlimited liability for all debts
C. perfectly elastic of the firm; most common form of busi-
ness organization in the United States
D. perfectly monopolistic
C. unincorporated business owned and
157. Laws in cities that restrict where busi- operated by two or more people who
nesses can operate. share the profits and have unlimited liabil-
A. Anti-Trust ity for the debts and obligations of the firm
B. Collusion D. form of business organization recog-
C. Zoning nized by law as a separate legal entity
with all the rights and responsibilities of
D. Patent
an individual, including the right to buy
158. The monopoly firm exists because of and sell property, enter into legal con-
tracts, and to sue and be sued
A. 1. government protection
B. 2. Monopoly in factors 162. Which market structure best describes a
C. 3.Large production market with homogeneous products and
D. All of these many sellers?
A. oligopoly
159. Which market structure involves on ONE
firm and has VERY HIGH barriers to entry? B. geographic monopoly
A. Monopoly C. perfect competition
B. Oligopoly
D. Perfect Competition 163. a government license that gives the in-
ventor of a new product the exclusive right
160. Which of the following products are usu- to produce and sell it
ally found in imperfect competition?
A. patent
A. Bananas
B. Onions B. license
C. Firewood C. market power

D. Shoes D. economies of scale

164. True or False:The United States govern- 170. Bernice owns her own local gift shop. She
ment encourages more monopolies. acquired the necessary loans to open it,
A. True assumes all the financial risk herself, and
makes all the decisions. It sounds like Ber-
B. False nice’s business is a/an
165. A way to attract customers without low- A. partnership
ering prices is B. franchise
NARAYAN CHANGDER
A. barriers to entry C. corporation
B. collusion D. sole proprietorship
C. cartel 171. Disadvantages include double taxation
D. nonprice competition and more government regulation
A. Sole Propriotorship
166. What is the condition for allocative effi-
ciency? B. Partnership
A. P = AC C. Corporation
B. P = MC D. none of above
C. P = MR 172. What is an example of an oligopoly?
D. P = AR A. chip industry
167. Which type of business model includes B. cellphone industry

buying large bulk items for their mem- C. cookie industry
bers? D. milk industry
A. non-profit
173. A market structure in which a few large
B. cooperative firms dominate a market.
C. monopoly A. Monopoly
D. multi-national B. Oligopoly
168. In a perfectly competitive market, how C. Perfect Competition
many producers are there? D. Monopolistic Competition
A. A few
174. Products that only differ slightly from
B. A large number their competition and sell at different
C. Only one prices in different markets
D. None A. Homogeneous products

B. Grade
169. An oligopoly has
C. Differentiated products
A. Many buyers and sellers
B. Only a few sellers
175. When the government sets a price floor
C. One seller on earned income, it is called which of the
D. No control over price following?

A. market equilibrium rate 179. Which of the following is NOT a merit

good?
B. base-level wage

A. energy drinks
C. minimum wage
B. education
D. employment guarantee
C. public libraries
176. Which company is an example of a D. health services
monopoly?
180. is a market structure characterized by
A. Coca Cola a very large number of buyers and sellers
B. Pepsi of an identical product.
A. monopolistic competition
C. DeBeers
B. oligopoly
D. AT&T
C. pure (perfect) competition
177. Which of the following market types has D. monopoly
all firms selling products so identical that
buyers do not care from which frim they 181. What type of liability do sole proprietor-
buy? ships have?
A. Unlimited Liability
B. Limited Liability
C. Corporate Liability
C. oligopoly
D. No Liability
D. monopoly
182. According to the principle of laissez-
178. The price charged by a perfectly competi- faire,
tive firm is A. governments either should not be in-
volved in the economy, or be as uninvolved
as possible.
B. government should regulate business
to create a more fair distribution of re-
sources.
C. government should own a share of
businesses to help earn profits and re-
duce taxes.
D. government should make most deci-
sions concerning business.
A. lower the more the firm produces.
183. When the few large sellers come to-
B. higher the more the firm produces. gether and fix prices
C. the same as the market price. A. Collusion
D. indeterminate. B. Price takers
E. different than the price charged by C. Product differentitation
competing firms. D. none of above

184. The organization of a market, based 189. Price Discrimination cannot persist under
mainly on the degree of competition. the following
A. Perfect Competition A. Perfect Competition
B. Externality B. Monopolistic
C. Public goods C. Monopoly
D. Market Structure D. Oligopoly
NARAYAN CHANGDER
185. for ice cream will when the 190. This is a market dominated by a few
weather is cold. large sellers
A. Demand, decrease A. oligopoly
B. Monopoly, demand B. monopoly
C. Demand, increase C. monopolistic competition
D. Demand, supply D. perfect competition
186. Which is an example of a seller in a 191. The greater the competition in the mar-
monopoly ket, the greater the profit?
A. Standard Oil A. Neither
B. Coke and Pepsi B. True
C. Restaurants C. False
D. Oranges in markets in Guadalajara D. none of above
187. What are the two main types of competi- 192. Mutual interdependence is a term
tion in the market structures? economists use to describe any price
A. Perfect competition and imperfect change made by one firm in an oligopoly
competition. that affects the pricing behavior of other
firms in the oligopoly
B. Monopoly and Oligopoly
A. TRUE
C. Local and Global
B. FALSE
D. Supply and Demand
193. What market structure does the letter
188. As firms enter a monopolistically compet- “R” in the table represent?
itive market, profits of existing firms
A. rise, and product diversity in the mar-
ket increases
B. rise, and product diversity in the mar-
ket decreases
C. decline, and product diversity in the
B. pure monopoly
market increases
C. oligopoly
D. decline, and product diversity in the
market decreases D. monopolistic competition

194. Is a license to operate an individually A. making a profit in the short-run

owned business in a special geographic
B. incurring a loss in the short-run
area as if it were a part of a large chain.

C. making a profit in the long-run
A. Franchise
B. Non-Profit D. breaking even in the long-run
C. Government Owned 200. In a monopoly market, the seller faces no
D. S Corporation
195. What is the market demand curve for a A. complain
monopoly firm? B. worries
A. The average revenue curve C. demand
B. The marginal revenue curve
D. competition
C. The total revenue curve
D. The price curve 201. Non-price Competition is
196. An agreement among firms to divide the A. a market that runs most efficiently
market or set prices is known as collusion. when one large firm supplies all of the
output; when competition would create
A. True chaos
B. False
B. a formal organization of producers
197. The market structure likely to have the that agree to coordinate prices and pro-
lowest prices is: duction
A. Monopoly C. competing on a basis other than price
B. Monopolistic Competition such as fragrance, location, color
C. Perfect Competition D. one firm in the private sector control-
ling the market
D. Oligopoly
198. As a determinant of demand, changes in 202. Process in which a lender reclaims the
peoples’ incomes cause them to purchase property due to a lack of payment by the
which two types of goods? borrower
A. Relative and real A. foreclosure
B. Normal and inferior B. restsession
C. Imports and local C. redemption
D. Capital and restricted D. vengeance
199. The graph shows a monopolistically com-
203. Few Large sellers with differenetiated or
petitive firm:
identical products
B. Monopolistic Competition
C. Oligopoly
D. Monopoly

204. What is monopolistic competition? B. raise their prices

A. one company selling the identical prod- C. go out of business
uct under different names D. lower their prices
B. one company selling several different
products under different names 209. An unintended side-effect that either ben-
efits or harms a third party not involved in
C. a very few companies selling identical the activity that caused it is a(n)
products
A. Let it happen
NARAYAN CHANGDER
D. many companies selling similar but not
B. Externality
identical products
C. Price-fixing
205. What is a contract issued by a govern-
D. Monopoly
ment entity that gives a firm a sole right
to provide a good or service in a certain 210. If a monopoly can perfectly price discrim-
area? inate, then its marginal revenue curve will
A. a copyright be
B. a license A. the same as its marginal cost curve.
C. a patent B. the same as its demand curve.
D. a public franchise C. a vertical line at profit maximizing out-

put.
206. Profit is D. the same as its supply curve.
A. the same as marginal revenue. E. undefined, it does not exist.
B. fixed expenses + variable expenses.
211. MONOPOLY has the advantages to
C. total revenue-total cost.
A. scale up
D. total revenue-marginal cost. B. stabilise the price
Explanation:Total revenues = all the
money coming into the business from C. allocate budgets for research and de-
sales.Total costs = all the money go- velopment
ing out for expenses.What is left over af- D. none of above
ter subtracting total costs from total rev-
enues is the profit for the business. 212. The situation in which sellers undercut
each other’s prices in an attempt to gain
207. Productive efficiency occurs where market share is called:
A. P = MC A. interdependent pricing
B. P = ATC B. price war
C. P = min ATC C. price leadership
D. MR = MC D. price competition
E. MR = 0 213. The government can create monopolies in
multiple ways. A (a) gives a company ex-
208. When a major airline lowers its prices, clusive rights to sell a new good or service
other airlines will probably for a specific period of time. On the other
A. maintain existing prices hand, governments can issue (b), which

grants businesses to operate a business, 218. An illegal agreement among firms to di-
when there are scarce resources involved. vide the market, set prices, or limit pro-
duction.

A. a patent
B. b licenses A. Agreement
C. franchise B. Collusion
D. business license C. Patent
E. regulations D. none of above
214. A corporation that engages in business 219. Who is the monster supposed to repre-
worldwide is referred to as a sent
A. Conglomerate
A. John D. Rockefeller/ Standard Oil
B. Horizontal Merger
B. Andrew Carnegie/ Carnegie Steel
C. General Partnership
D. Multinational C. Cornelius Vanderbilt/ Railroad
D. JP Morgan/ JP Morgan Co.
215. Wheat has seen a decrease in demand of
5%, while the price has increased 7% 220. Factors other than price to distinguish a
A. 1.4 inelastic product from competing brands is also re-
ferred to as
B. 1.4 elastic
C. .71 inelastic
D. .71 elastic
216. How many firms are there in a
monopoly?
A. 1
B. 2-5
C. Many
D. 70
217. If a monopolist wants to sell a larger
quantity, it must
A. set a higher price A. Non-price Competition
B. maintain the current price B. Perfect Competition
C. set a lower price C. Price Discrimination
D. implement new technology D. Collusion

221. What type of market structure has a few B. Perfect Competition

firms, and a lot of control over price? C. Regulation
A. Perfect Competition D. Non-Price Competition
B. Oligopoly
226. In this market, sellers have the least con-
trol over prices:
D. Monopoly
NARAYAN CHANGDER
222. The characteristics of MONOPOLISTIC B. Monopolistic competition
COMPETITON are
C. Oligoply
A. price takers
D. Monopoly
B. price makers
227. In a market economy, what determines
C. low barriers
what and how much to produce?
D. differentiated products
A. Random selection
E. close substitutes
B. Producer’s personal preferences
223. This industry should be described as C. Supply and demand
which market structure?
D. Government regulations
228. What is the goal of a firm?

A. to make profits
B. to maximize profits
C. to maximize revenue
229. Tony opens up a hot chocolate stand for
B. oligopoly two hours. He spends $10 for ingredients
C. monopoly and sells $60 worth of tasty beverages.
In the same two hours, he could have pro-
vided Uber services (illegally because he
224. Which type of market structures has very isn’t 18) and earned $40. Tony’s account-
few producers(companies) that control the ing profit is and an economic profit of
majority of the market?
A. perfect competition A. $50, $10
B. monopolistic competition B. $90, $50
C. oligopoly C. $10, $50
D. monopoly D. $50, $90
225. When businesses set prices below cost 230. In which way does monopolistic competi-
for a time to drive competitors out of a tion differ from perfect competition?
market A. Average revenue exceeds average
A. Predatory Pricing cost in long-run equilibrium

B. Barriers exist to the entry of new firms B. Oligopoly

C. MR exceeds MC in long-run equilib- C. Perfect competition

rium
D. Monopolistic competition
D. Products are differentiated
236. What does marginal mean in the lan-
231. What is NOT part of nonprice competi-
guage of economics?
tion?
A. Additional
A. prices
B. location B. Less
C. quality C. Satisfaction
D. advertising D. I can’t believe it’s not Butter.
232. Compared to a perfectly competitive in- 237. Which business organizations just pay
dustry with the same demand and cost normal taxes based on the income of the
curves, a monopoly’s price and quantity individual owner(s)? (pick 2)
will be which of the following?
A. Partnerships
A. P=Higher; Q=Same
B. Sole proprietorships
B. P=Lower; Q=Same
C. Corporation
C. P=Lower; Q=Higher
D. P=Higher; Q=Lower D. none of above
233. Which of these is NOT an entry barrier 238. In this environment, companies sell dif-
created by government? ferent products and services, set their own
individual prices, fight for market share,
A. License
and are often protected by barriers to en-
B. Patents try and exit.
C. Franchise A. Oligopoly
D. Price discrimination B. Imperfect Competition
234. An economic system in which economic C. Capital
decisions and the pricing of goods and ser-
vices are guided by the interactions of D. none of above
a country’s individual citizens and busi-
239. William, Elijah, and Sophia are discussing
nesses.
market structures in their economics class.
A. Market They come across a market structure
B. Capital where a few large firms dominate the mar-
ket. Which market structure are they talk-
C. Human Capital
ing about?
D. none of above
A. oligopoly
235. Markets like automobiles, cell phones, ca-
B. monopsons
ble TV, and internet providers are exam-
ples of which market structure? C. perfect competition
A. Monopoly D. monopoly

240. Which of the following statements is cor- C. Competitive behavior and competitive
rect? market structure are unrelated.
A. The market demand and the firm’s de- D. Competitive behavior is influenced by
mand are the same for a monopoly the competitive market structure.
B. Monopolies have perfectly inelastic de-
mand for the product sold 245. A cable television company merges with
a company that uses satellite dish technol-
C. Monopolies are guaranteed to earn an ogy to provide television service to con-
NARAYAN CHANGDER
economic profit. sumers.
D. All of the above are correct
A. Horizontal
241. The ease of entry and exit means B. Vertical
A. degree of product differentiation C. Conglomerate
B. number of companies on the market
D. none of above
C. ease of entry and exit from the market
246. Public utilities (think FPL/City Water)
D. none of above are an example.
242. A competitive market becomes a
monopoly. What is likely to happen? B. Natural Monopoly
A. Consumer surplus will be reduced by C. Monopolistic Competition
the amount of the deadweight loss.
D. Oligopoly
B. Producer surplus will be reduced by
the amount of the deadweight loss. 247. Why do US markets dominated by
C. The loss in consumer surplus will be oligopolies result in higher prices than mar-
balanced by the increase in producer sur- kets with normal competition?
plus. A. The oligarchies are interdependent
D. There will be a transfer of surplus from with each other. As a result, when one
consumer to producer. company lowers their price, the other
companies will have to lower their prices
243. What consist of differentiated products? to match.
A. Close but not perfect substitutes
B. The companies of the oligarchy can col-
B. Many perfect substitutes lude (scheme together) to fix the prices at
C. No close substitutes a unnaturally high rate compared to nor-
mal competition.
D. No substitutes of any kind
C. Keeping up with the other companies
244. What is the relationship between com- of the oligarchy is expensive. To pay for
petitive behavior and competitive market these innovations, prices rise, and there
structure? isn’t enough competition to lower it.
A. Competitive behavior has no impact on D. One company controls the whole in-
the competitive market structure. dustry, so they can charge whatever un-
B. Competitive market structure is deter- reasonably high price they want for their
mined by government regulations. product.

248. Businesses and individuals decide what A. natural monopoly

to produce and buy, and the market deter-
B. technological monopoly
mines prices and quantities to be sold. The

market will work out the price. C. government monopoly
A. Free-Market economy D. geographic monopoly
B. Socialism
252. Laws that define monopolies and give
C. Communism government the power to control them and
D. Mixed Economy break them up
249. This is the minimum price buyers are re- A. Regulation

quired to pay for a good. It’s a lower limit B. Antitrust legislation
for the price.
C. Market allocation
A. equilibrium
D. Deregulation
B. shortage
C. price floor 253. a person or company that makes, grows,
D. price controls or supplies goods to sell is called the?
E. price ceiling
250. If coffee and cream are complementary

goods, an increase in the price for coffee
will
A. increase the price of cream A. Damand
B. decrease the demand for cream B. price
C. have no effect of the price of cream C. producer
D. have no effect on the demand for
D. shortage
cream
251. When Gillette Co. unveiled Mach3, the 254. Which of the following best describes
world’s first triple-blade razor, it took a what will happen in the long run if many
bold gamble Mach3 cartridges were to firms in a perfectly competitive market are
sell for around $1.60 each. Skeptics pre- experiencing short-run economic losses?
dicted the personal-care giant would soon A. Firms’ costs will decrease, causing
be forced to cut that price. But the price is their economic profits to increase
holding and Mach3 has become the No. 1
blade and razor. What’s the secret to pric- B. Firms will enter the industry, causing
ing power? For starters, a commitment to market demand to increase
innovation. Gillette spent nearly $1 bil- C. Firms will go out of business, causing
lion on the development and initial mar- market demand to decrease
keting of Mach3. Source:Business Week,
D. Firms will enter the industry, causing
February 1, 1999 Based on the passage,
market supply to increase
what type of monopoly is helping Gillette
Co. maintain a high price for its Mach3 ra- E. Firms will go out of business, causing
zor? market supply to decrease

255. Average Revenue (AR) > Average cost C. An example is a partnership.

(AC) in the short run for PERFECT COM- D. A purely competitive market sells sim-
PETITON is ilar products.
A. economic profit
260. The easiest form of business to start and
B. supernormal profit
end is a(n)
C. economic loss
A. limited liability partnership
D. normal profit
NARAYAN CHANGDER
B. monopoly
256. This industry should be described as
C. franchise
D. proprietorship
261. The least competitive market structure

A. Monopoly
B. Oligopoly
C. Monopolistic competition
A. perfect competition D. Perfect competition

B. oligopoly 262. All of these options describe a character-
C. monopoly istic of monopolistic competition EXCEPT
which option?
A. many buyers
257. The reliance on one another to provide
the resources and goods and services that B. identical products
people need. C. a downward-sloping demand curve
A. Law of demand D. no barriers to entry
B. Businesses E. many sellers
C. Factor market
263. Sole proprietorship business can be
D. Economic interdependence started by
258. What kind of monopoly often provides A. at least seven persons
public goods?
B. any one person
A. Natural Monopoly
C. at least two persons
D. at least three persons
D. Technological Monopoly 264. Which market structure is the worst for
consumers?
259. What is the true of a market structure?
A. oligopoly
A. It is the way an individual business is
B. geographic monopoly
set up.
B. It describes the level of competition C. perfect competition
between businesses. D. monopolistic competition

265. Why do oligopolies frequently appear to 269. Fiscal policy refers to the power of the
act together. federal government to

A. They collude (secretly scheme to- A. tax and spend.
gether) to keep the prices in their industry B. print money.
unnaturally high.
C. control credit.
B. If one company has a lower price or a
new innovation, all the other companies D. All of the above
will have to match it or risk losing cus-
270. Promotes a just and fair system
tomers.
A. freedom
C. They are all controlled by one large
parent company that delegates what ac- B. equity
tions each smaller company must perform C. security
D. growth
D. There is generally only one company
that actually comes up with good ideas, 271. Which type of business organization is
and all the other companies follow what- owned and operated by a single individ-
ever actions they take. ual?
A. partnership
266. this may be the closest to perfect compe-
tition B. sole proprietorship
A. Ebay C. corporation
B. Amazon D. limited liability company tagsSSEMI3
C. Walmart 272. Which statement is most accurate?
D. Local Farmer’s Market A. Markets can sometimes fail.
267. A ton of companies make clothing but B. Markets can theoretically fail, but not
some brands are able to charge more be- in reality.
cause of perceived status or quality. this C. Market failure is a myth.
puts them in which market structure
D. Market failure is an unproven hypothe-
A. Perfect Competition sis.
273. This is a perfectly competitive firm, at a
C. Oligopoly price of $8
D. Monopoly
268. factors that make it difficult and costly

for an organization to enter a particular
task environment or industry
A. barriers to entry
B. regulations
C. costs
D. monopolies A. it makes economic profit.

B. it incurs economic loss. 279. What kind of market structure is efficient

C. it breaks even. with 1 business supplying?
D. it shuts down. A. natural monopoly
274. Competition promotes innovation. B. oligopoly

A. True C. imperfect competition
B. False D. perfect competition
NARAYAN CHANGDER
275. Susan works for the state of Georgia as
a probation officer. Her labor provides 280. Which of the following is not a character-
the government with a service, and in re- istic of a competitive market?
turn she is paid by the state. With her A. There are many buyers and sellers in
salary, Susan buys goods she needs from the market.
private firms. She also pays taxes to the
government so they can continue to pro- B. The goods offered for sale are largely
vide public services that people need. Su- the same.
san’s economic interdependence with the C. Firms generate small but positive eco-
government and private businesses is re- nomic profits in the long run.
ferred to as
D. Firms can freely enter or exit the mar-
A. economic independence ket.
B. the monetary cycle
C. the money flow 281. This market structure has 3-4 firms who
dominate 70-80% of the industry.
D. circular flow of economic activity
276. Market structure where market power
is increased because they are the only or
very few who provide this product.
B. Oligopoly
A. Monopoly
D. Monopoly
277. A dump truck is an example of which fac-
tor of production? C. Perfect Competition
A. Land D. Oligopoly
B. Labor
282. Which of the following examples repre-
C. Capital
sents a Monopolistic Competition?
D. Entrepreneurship
A. Music
278. When competitors cut their prices really
low to win business B. Airlines
A. Price War C. Textile farmer

B. Collusion D. Cereals

283. Which of the following market structures 287. Business model in which stock is sold to
is considered a price maker(the business help raise money for re-investment in the
sets the price and has control over the company

price)? A. corproation
A. perfect competition B. sole proprietorship
B. monopolistic competition C. partnership
C. oligopoly D. none of above
D. monopoly 288. The amount of goods or services avail-
able is called?
284. Which market structure has the most pric-
ing power? (Pricing power is the ability
to raise your price above your competition
and still make sales)
B. oligopoly
C. monopoly
285. Oligopolies control prices by A. supply

A. non-price competition B. demand
B. magic C. producer
D. consumer
C. collusion
D. all of the above 289. The market for razor blades is domi-
nated by Procter and Gamble’s Gillette and
286. When competitors cut their prices re- Edgewell Personal Care’s razors. What
ally low to win business. Happens in level of barriers of entry are there in this
oligopolies and can form monopolies. market?
A. Low
B. None
C. High
D. none of above
290. in game theory, when players have

strong preference for a strategy, it is
called
A. Price War A. dominant strategy
B. Collusion B. dominated strategy
C. Cartel C. preferred strategy
D. Price Discrimination D. differentiated strategy

291. This monopolistic competitor must be op- 293. What is product differentiation in monop-
erating in the olistic competition?
A. The practice of selling identical prod-
ucts at different prices in different mar-
kets.
B. The strategy of making a product or
service appear distinct from others in the
market through branding, design, quality,
NARAYAN CHANGDER
or other features.
C. The process of reducing the price of a
product to attract more customers.
A. red (taking an economic loss).
D. The act of copying the design or
B. short run. features of a competitor’s product.
C. long run. tagsSSEMI3
D. black (making an economic profit). 294. Which law bans monopolies?
292. Which of the following is the definition A. Tea Act
forsole proprietorship B. Anti-Trust Act
C. Townsend Act
D. Monopoly Act
295. Which of these market structures has
more market power over setting prices?
A. Pure competition
B. Monopoly
A. business investment that involves rent- C. Monopolistic competition
ing or leasing another successful busi- D. Oligopoly
ness model
296. One of the requirements for a monopoly
B. unincorporated business owned and
is that
run by a single person who has rights to all
profits and unlimited liability for all debts A. there is a unique product with no close
of the firm; most common form of busi- substitutes
ness organization in the United States B. products are high priced
C. unincorporated business owned and C. there are several close substitutes for
operated by two or more people who the product
share the profits and have unlimited liabil- D. the product cannot be produced by
ity for the debts and obligations of the firm small firms
D. form of business organization recog-
nized by law as a separate legal entity 297. A soft drink manufacturer that decides to
with all the rights and responsibilities of buy a sugar plantation to ease the produc-
an individual, including the right to buy tion of its products would be an example
and sell property, enter into legal con- of
tracts, and to sue and be sued A. conglomerate

B. vertical merger 304. The most recognizable form of non-price

C. horizontal merger competition is?

D. corporation A. More Locations
298. Demand is unit elastic if it is less than 1.0 B. Better Customer Service
A. True C. Advertising
B. False
D. Low Price
299. Select all the kinds of barriers of entry:
A. High capital costs (fixed costs) 305. What is the definition of an oligopoly?
B. High sunk costs A. one firm producing 95 percent of the
C. Strong brand image output
D. Patent B. two to four firms producing 70 percent
300. McDonalds is in what market to 80 percent of the output
A. Perfect Competition C. eight to ten firms producing 60 percent
B. Monopolistic Competition to 70 percent of the output
C. Oligopoly D. eight to ten firms producing 90 percent
D. Perfect Competition of the output
301. All of the houses in Glynn County are ser- 306. In monopolistic competition, product dif-
viced by Georgia Power for their electric- ferentiation can be achieved by
ity. What type of monopoly is this?
A. Geographic Monopoly A. advertising
B. Technical Monopoly B. cooperation

C. Natural Monopoly C. causing non-price competition
D. Government Monopoly
D. all of the above
302. The soft drink industry, including Coca-
Cola, Pepsi Co., and the Schweppes Group 307. Which market structure is defined by a
are examples of: single producer?
A. Monopoly
A. pure competition
B. Perfect competition
C. Oligopoly
D. none of above C. oligopoly
303. In the Long Run, what is the equilibrium D. monopoly

position of a Perfectly Competitive Firm?
A. MC = MR = AC = AR 308. If Price > ATC;Then, Firm earns an eco-
nomic profit
B. MC = MR = TC = AR
C. MC = MR = AVC = AR A. True
D. MC = MR = AFC = AR B. False

309. Which market structure has a single 312. What is the main goal of firms in a mo-
seller with complete control over the mar- nopolistic competition market structure?
ket? A. To differentiate their products and cre-
A. Monopoly ate a loyal customer base to maintain mar-
ket power and earn profits.
B. Oligopoly
B. To sell identical products at the lowest
C. Perfect competition price possible
NARAYAN CHANGDER
C. To collaborate with other firms to elim-
inate competition
310. -Few sellers-Some control over price-
High market entry barriers-Some product D. To reduce the quality of their products
differentiation, What type of market struc- to increase sales
ture is described by the list above? 313. Which of these describes a perfectly com-
A. Oligopoly petitive market?
B. Natural monopoly A. Products are exactly the same
C. Pure competition B. There are a few producers
D. Monopolistic competition C. Businesses spend money to advertise

D. Many products are similar
311. Which of the following is true?
314. In this market structure, sellers can enter
and exit the market freely
A. Monopoly
B. Oligopoly
C. Monopolistic Compeition
315. The Supply Curve has moved left. Where

A. Player one dominant strategy is choice is the new equilibrium price and quantity?
B, Player 2 does not have a dominant strat-
A. Higher, higher
egy
B. Lower, lower
B. Player one dominant strategy is choice
B, Player 2 dominant strategy is A C. Lower, higher
C. Player one dominant strategy is choice D. Higher, lower

A, Player 2 does not have a dominant strat-
316. a contract that gives a single firm the
egy
right to sell its good within an exclusive
D. Player one does not have a dominant market
strategy, Player 2 dominant strategy is A. franchise
choice A
B. license
E. Player one does not have a dominant
strategy, Player 2 dominant strategy is C. market power
choice A D. monopoly

317. What is the difference between perfect B. Factors that make it difficult for a new
competition and monopolistic competition? firm to enter a market.

A. In perfect competition, firms produce C. A market structure in which a few
identical products, while in monopolistic large firms dominate a market.
competition does not.
D. An illegal agreement among firms to
B. Perfect competition has a large num- divide the market, set prices, or limit pro-
ber of small firms while monopolistic com- duction.
petition does not.
C. Perfect competition has barriers to 321. Which of the following is NOT a definition
entry while monopolistic competition dos for market?
not. A. Any structure that allows buyers and
D. Perfect competition has no barriers to sellers to exchange goods, services and
entry while monopolistic competition does information
not.
B. Any mechanism that facilitates the in-
318. An industry that is dominated by a few teraction of buyers and sellers with a view
large firms is to the purchase and sale of good or ser-
vice
A. monopolistic competition.
C. The amount of persons/firms who pro-
B. a monopoly.
vide a product for sale
C. perfect competition.
D. All persons who are willing and able to
D. an oligopoly. purchase a particular goods or service
319. Define Income Elasticity of Demand
322. Businesses can “Collude” or work to-
A. YED measures the degree of respon- gether to set prices
siveness of quantity demanded for a good
to a change in consumer’s income, ceteris A. Oligopoly
paribus B. Monopoly
B. YED measures the degree of respon- C. Perfect Competition
siveness of demand for a good to a change
in consumer’s income, ceteris paribus D. Monopolistic Competition
C. YED measures the degree of respon-
323. These could be as a result of legal ob-
siveness of consumer’s income to a
stacles from specific laws, patents, copy-
change in quantity demanded for a good,
rights, and trademarks, or they could be
ceteris paribus
due to natural obstacles like extensive
D. YED measures the degree of respon- economies of scale for large producers or
siveness of consumer’s income to a dominating a key resource needed to pro-
change in demand for a good, ceteris duce the good.
paribus
A. scarcity
320. What are barriers to entry? B. number of sellers
A. A market in which there are many buy-
C. product differentiation
uct D. Barriers to entry

324. Businesses can “Collude” or work to- 329. A market dominated by a few large, prof-
gether to set prices itable firms
A. Oligopoly A. Monopoly
B. Monopoly B. Natural Monopoly
D. Pure Competition
D. Oligopoly
NARAYAN CHANGDER
325. Which type of market structures has very
few producers (companies) that control 330. NPF-AI developed to mimic teachers.
the majority of the market?Hint:think of What curve is impacted in the education
the soda market/phone companies labour market and how?
A. perfect competition A. Demand Left
B. monopolistic competition B. Demand Right
C. oligopoly C. Supply Left
D. monopoly
D. Supply Right
326. Do you think this firm has control over
price? 331. An agreement by firms to charge uniform
prices for a product is called.
A. Yes
A. Price-fixing
B. No
C. Maybe B. Monopoly
D. none of above C. Positive externality

D. Negative externality
327. The marginal revenue curve in monopoly:
A. Equals the demand curve 332. When there is a perfect competition, one
B. Is parallel with the demand curve seller emerges as the primary controller of
price as it squeezes out its competitors.
C. Lies below and converges with the de-
mand curve A. True
D. Lies below and diverges from the de- B. False
mand curve
333. What is the equilibrium position of a Per-
328. Use the following headlines to answer
fectly Competitive Firm in the Short Run?
the question below. Many sellers in mar-
ketProduct must be different to attract A. The point where MC = MR and MC is
consumersLots of advertisingEasy to enter rising
and exit the market The above headlines B. The point where AC = AR and AC is
are all examples of falling
A. Oligopoly
C. The point where MC = MR and MC is
B. Monopolistic competition falling
C. Monopoly D. The point where AC = AR and AC is ris-
D. Pure (perfect) competition ing

334. A monopoly that is based on the owner-

ship or control of a manufacturing method,
process, or other scientific advance is a

A. geographic monopoly
B. natural monopoly
C. government monopoly A. Corporation
D. technological monopoly tagsSSEMI3 B. General Partnership
C. Limited Liability Partnership
335. When firms agree to charge the same or
similar prices for a product, this is known D. Sole Proprietorship
as
339. A market structure that has many sellers,
A. price-fixing has a standardized products and is easy to
enter and exit
B. independent behavior
A. Monopoly
C. natural monopoly
B. Oligopoly
D. let it happen
336. The cartel model of oligopoly leads to: D. Perfect Competition
A. All the firms in the industry acting as E. Barriers to entry

one to set a monopoly price
340. System of business where individuals
B. Each producer acting independently of (owners) are free to decide what to pro-
others duce, how to produce it, and what price to
sell it
C. Firms following the low-price firm in
the industry A. Communism
B. Free Enterprise
D. Differences in cost of production dis-
couraging individual firms from cheating C. Socialism
D. Mixed Economy
337. Which of the following is NOT one of the
reasons why markets fail? 341. Ethan, Luna, and Mason are running a
lemonade stand in a perfectly competitive
A. Resources that can’t or won’t move
market. What is the shape of the demand
B. Not enough competition curve for their lemonade stand?
C. Not enough information A. Perfectly inelastic (vertical)
D. Too much competition B. Downward sloping

C. Upward sloping
338. A business firm owned by sharehold- D. Perfectly elastic (horizontal)
ers who possess ownership rights to the
firm’s profits, but whose liability is limited 342. A perfectly competitive demand curve is
to the amount of their investment in the considered to be while a monopoly de-
firm (stocks) is known as a mand curve is considered to be

A. flat, curved 348. Ryan Brown and Leighton Jones have

B. flat, downward-sloping a partnership. Leighton embezzles the
company’s profits and moves to Mexico.
C. downwardly sloping, downward- Which of the following describes Ryan’s li-
sloping ability?
D. none of above A. Because Ryan didn’t do anything ille-
343. All of the following are conditions of mo- gal, he is not responsible.
nopolistic competition EXCEPT B. Ryan’s personal assets are at risk.
NARAYAN CHANGDER
A. differentiated products C. Ryan’s personal assets are completely
B. many sellers (firms) safe.
C. slight control over price D. none of above
D. high barriers to entry 349. Which of the following would be most
likely be subject to government monopoly
344. A market structure in which a small num-
regulations?
ber of firms face competition from poten-
tial entrants. What does this describe? A. computer software company
A. A contestable market B. large oil company
B. A monopoly C. local restaurant
C. Perfect oligopoly D. local cable company
D. Monopolistic competition 350. For this monopolist, what is the area of
345. What type of lifespan do most partner- consumer surplus?
ships have?
A. Limited life
B. Unlimited life
C. Eternal life
D. Life sentence
346. a large number of businesses selling the
same products at the same price
B. Monopoly
C. Oligopoly A. Cheer up
D. Monopolistic competition B. AJGC
C. ARJ
347. SSEMI3 b This is a market structure in
which a single seller controls the market. D. ARGE
A. Perfect Competition 351. Business model in which the owner gets
B. Monopolistic Competition all of the profit
C. Oligopoly A. sole proprietorship
D. Monopoly B. corporation

C. partnership C. Oligopolies exist when a few very

D. none of above large sellers of a product dominate the
market.

352. Which market structure is characterized D. A market structure in which a few
by a few large firms dominating the mar- small firms dominate the industry and
ket? have the power to control prices and out-
A. oligopoly put.
B. monopoly 357. Number of Sellers:Are there many, few,
C. perfect competition or one seller(s) of the product? The more
sellers there are, the more the market
D. monopsons is.
353. A market with many well informed buy- A. competitive
ers and sellers, identical products, and free B. saturated
entry and exit
C. limited
D. monopolistic
B. Barriers to entry
C. Start up costs 358. Which of the following is a table that
shows the relationship between price and
D. Imperfect competition demand?
354. Collusion/ Cartels occur in this market A. demand schedule
structure B. demand curve
A. Perfect Competition C. demand function
B. Monopolistic Competition D. demand chart
C. Oligopoly
359. A monopoly’s prices are determined by
D. Monopoly
A. Competing Firms
355. This is an illegal act in which companies B. Market equilibrium
agree to set the price of their good or ser-
C. Perfect competition
vice the same.
D. the monopoly
A. Commodity
B. Commercialization 360. A relevant market contains a set of goods
whose cross elasticities with others in the
C. Barrier to entry
set are relatively high and whose cross
D. Collusion elasticities with goods outside the set are
relatively low
356. Oligopoly
A. TRUE
A. A market structure in which a single
firm dominates the industry and has the B. FALSE
power to control prices and output. 361. An illegal agreement among firms to di-
B. A market structure in which firms have vide the market, set prices, or limit pro-
no control over prices and output. duction is known as

B. Tries to convince consumers that one

product is better than another.
C. The practice of lowering prices to at-
tract customers
D. The use of discounts and promotions
to increase sales
A. a Franchise 366. One business is in complete control of the
NARAYAN CHANGDER
B. Cartel market
C. Collusion A. Monopoly
D. an Oligopoly B. Oligopoly
362. All of the following are true about adver-
tising except that it D. Monopolistic competition
A. plays a more effective role in monopo- 367. Jim’s pressure-washing company is
listically competitive markets than in per- growing exceptionally fast and he will
fectly competitive markets soon need to purchase several new ma-
B. is used to reduce product differentia- chines and increase his advertising.
tion
C. is used to make a firm’s demand curve
more inelastic
D. is used to increase a firm’s market
share
E. is used to reduce consumer sensitivity
to price changes A. Sole-Proprietorship
B. Partnership
363. A seller in perfect competition has how
much control over price? C. Corporation
A. total control D. none of above
B. considerable control 368. In an oligopoly, what is the term used to
C. little or no control describe when firms collude to maximize
their joint profits?
D. none of above
A. monopoly
364. A B. collusion
A. B C. cartel
B. C D. competition
C. D 369. Which type of market structures has
D. none of above many producers (companies) and sell simi-
lar but different products from each other?
365. Non-price Competition These companies have a little control over
A. The process of increasing prices to in- the price and there are relatively low bar-
crease profits riers to entry.

A. perfect competition B. Oligopoly

B. monopolistic competition C. Monopolistic Competition

C. oligopoly D. Pure Competition
D. monopoly
375. Which of the following is true about a per-
370. The U.S. Postal Service is an example fectly competitive market?
(first-class mail only)
A. Firms produce standardized commodi-
A. Perfect Competition ties
B. Not all sellers are fully informed about
C. Oligopoly technology
D. Pure Monopoly C. One individual buyer or seller can usu-
371. Avery, Evelyn, and Grace are studying ally influence price
about different types of monopolies in D. It is difficult for firms to enter the mar-
their economics class. They learned about ket
a type of monopoly that is created by the
government. Can you recall what it is 376. Under perfect competition, buyers and
called? sellers
A. Technological monopoly A. Act independently
B. Government monopoly B. Deal in identical products
C. Franchise
C. Must be reasonably informed about
D. License products
372. All of the following are examples of D. All of the above
Oligopolies except?
377. In this market, the producer is the least
A. Fast food restaurants
responsive to buyers’ needs and wants.
B. Breakfast cereal companies
C. Cell phone companies
B. Pure Monopoly
D. Auto manufacturers
373. Market structure is the selling environ-
ment where a firm and sells its prod- D. Oligopoly
uct.
378. All of the following are characteristics of
A. buys
oligopolies, EXCEPT
B. produces
A. they expect “customer loyalty.”
374. Benjamin, Henry, and Anika are partici- B. the products have little to no differ-
pating in a local farmers market. In this ences.
market, there are many other buyers and
sellers as well. What type of market struc- C. They have limited control over price,
ture does this scenario represent? except lowering them in price wars.
A. Monopoly D. They encourage innovation.

379. If a good has relatively few substitutes C. 700

to take its place, what kind of elasticity is
D. 800
it more likely to have?
A. Inelastic 383. In which market structure is there NON-
B. Unit-Elastic PRICE competition?
C. Elastic A. Oligopoly and Monopoly
D. none of above B. Oligopoly and Monopolistic Competi-
NARAYAN CHANGDER
tion
380. A perfectly competitive industry will pro-
C. Monopolistic Competition and Perfect
duce a quantity of goods
Competition
D. Perfect Competition and Monopoly
384. Which market structure is characterized

by many firms, differentiated products,
and easy entry for new firms?
A. Monopolistic competition
B. Oligopoly
A. less than a single price monopoly.
B. the same as a single price monopoly.
C. could be more, less, or the same as a D. Monopoly
single price monopoly depending if the MR
385. Government subsidies are more likely to
curves lies above or below the D curve.
shift a supply curve in which direction?
D. greater than a single price monopoly.
A. No shift
381. Which type of market structure is the B. Increase to the right
sweatshirt industry?
C. Decrease to the left
D. none of above
C. oligopoly 386. In which market structure does a firm
D. monopoly have the greatest control over its prod-
uct’s price?
382. At which quantity does supply and de-
A. Monopoly
mand reach equilibrium?
B. Oligopoly
387. Unlike perfect competition, a monopolist

can make abnormal profits in the long run.
A. 500 A. True
B. 600 B. False

388. The major focus of sellers in this market 393. A competitive market is characterized by
is branding and marketing A. a large number of sellers and buyers.

A. Monopoly B. diverse products.
B. Oligopoly C. sellers acting together to set prices.
C. Monopolistic Competition D. uninformed buyers and sellers.
394. market structure in which a few very
389. Oligopolistic markets would often be un- large sellers dominate the industry.
der close monitoring by the government to A. perfect competition
prevent collusion. B. monopolistic competition
A. TRUE C. oligopoly
B. FALSE D. monopoly
390. Many sellers and many buyers 395. What is imperfect competition?
A. Perfect Competition A. a market with no conditions required
for perfect competitions
B. lacks one or more of the conditions re-
C. Oligopoly
quired for perfect competition
D. Monopoly
C. it does not have a market structure at
all
391. Why is a monopoly able to charge a lower
price and produce a higher output level D. there is no competition at all
than perfect competition?
396. Mason, Grace, and Ava started a lemon-
A. There are high barriers to entry in a ade stand in their neighborhood, which is
monopoly. a perfectly competitive market. What de-
B. A monopoly is able to reap economies termines the price that they can charge for
of scale. a glass of lemonade?
C. A monopoly is able to earn economic A. The intersection of the neighborhood’s

profits. demand for lemonade and their supply
D. A monopoly is a price setter. B. Their desired profit margin

C. The government regulations
392. What is the frequency of a variable?
D. The cost of producing the lemonade
A. the number of times it does not appear
in a distribution 397. This was put in to place that allows the
government to control and regulate mo-
B. the number of times it is used after a nopolies.
distribution
A. Sherman Anti-Trust Act
C. the number of times it shows on a line
graph B. Regulation laws
D. the number of times it reappears in a C. Deregulation laws

distribution D. Collusion

398. Monopolistic competition= 403. The owners of a corporation are called

A. one company selling different. prod- A. Directors
ucts B. Partners
B. very few companies C. Shareholders
C. many different companies selling simi- D. Founders
lar but not identical products
404. Columbia Tires and Pacific Tires together
D. none of above
NARAYAN CHANGDER
control 75% of the tire market in the coun-
try. What would this be?
399. Which of the following is an example of
perfect competition? A. a monopoly
A. bananas B. an oligopoly
B. public water C. a perfect competition
C. grocery stores D. a monopolistic competition
D. running shoes 405. Only five firms produce this product in

the Unites States.
400. Demand is almost always more elastic
at higher prices and less elastic at lower
prices. B. Pure Monopoly
A. True C. Monopolistic Competition
B. False D. Oligopoly
406. Suppose a firm in a perfectly competi-

401. Because barriers to entry are high, firms
tive market produces and sells 8 units of
in perfect competition can’t enter or leave
output and has a marginal revenue of $8.
the market with ease.
What would be the firm’s MARGINAL rev-
A. True enue if it instead produced and sold 4 units
B. False of output?
A. $2
402. More sellers enter the “Pizza” market.
What happens to the total number of piz- B. $8
zas supplied? C. $32
D. $64
407. What does liability mean?

A. Legal responsibility
B. Legal representation
C. Ability to lie
A. they decrease (curve shifts left) D. Trustworthiness
B. they increase (curve shifts right)
408. AN EXAMPLE OF MONOPOLISTIC COM-
C. they stay the same (the curve stays) PETITION?
D. none of above A. APPLE IOS

B. SOAP 414. A market structure in which one firm has

a monopoly because of its location is a
C. FIDEO SOUP

D. CEREAL A. natural monopoly
409. Car producers are an example of
C. geographic monopoly
A. monopoly
D. government monopoly
B. oligopoly
C. monopolistic competition 415. Product differentiation refers to
D. pure / perfect competition A. different prices for the same good
B. different goods that have identical
410. Which of these are most likely to compete
prices
in a monopolistic competitive market?
C. differences among goods in a market
A. Furniture stores
that make them close, but not perfect sub-
B. Jewelry stores stitutes for each other
C. makeup stores D. markets that differ from industries be-
D. All of these are likely to be in monopo- cause their goods are essentially differ-
listically Competitive markets. ent
E. the firm’s ability to create different
411. Which of the following is an example of goods while using the same technology
a co-operative? and resources
A. Costco
416. Both labor and management agree to talk
B. Walmart to a third party and both sides must agree
C. Target to the decision is a/an
D. Meijer A. strike
B. third party negotiation
412. SSEMI3 b IN which market structure
do sellers have virtually no control over C. mediation
price?
D. arbitration
417. In a monopolistic competition, sellers
B. Pure competition
can market their products differently from
C. Oligopoly other sellers hence, they have some con-
D. Monopoly trol over the price of the product.
A. True
413. Impossible to Enter Market
B. False
A. Oligopoly
B. Monopoly 418. In the 1990s, ATT controlled 80% of the
phone industry and was the ONLY provider
of long distance phone service. This is an
D. none of above example of

B. boycott
C. market failure
D. court injunction
423. What is price mechanism?

A. the interaction between demand and
A. A monopoly supply
NARAYAN CHANGDER
B. Monopolistic Competition B. the constant increase in price
C. Perfect Competition C. the constant decrease in price
D. Oligopoly D. the theory of demand and supply
419. Definition:Barriers to Entry 424. The diagram represents a(n)
A. The sole supplier of a product with no

close substitutes
B. The ability of a firm to raise its price
without losing all sales to rivals
C. Restrictions on the entry of new firms
into an industry
D. A product that is identical across sell-
ers, such as a bushel of wheat
A. increase in supply
420. Being your own boss can make it fun but B. decrease in supply
also challenging at times
C. change in quantity supplied
A. Sole proprietorship
B. Partnership
425. The true efficiency of depends on
C. Corporation
whether the gains from product differen-
D. none of above tiation and the variety it creates offsets
the extra costs of excess capacity.
421. A merger between for or more com-
panies producing or marketing differ-
ent/unrelated products is referred as a(n)
A. conglomerate.
B. vertical merger.
C. corporation.
D. horizontal merger.
422. When management doesn’t allow the

workers to work until an agreement is
reached A. monopolistic competition
A. lockout B. perfect competition

C. oligopoly C. government regulations restricting

D. monopoly new producers

D. high taxes and fees making it too ex-
426. A corporation is a business for which pensive to enter
ownership is divided into shares or stocks
that may be bought and sold through a 430. The selling environment has basic
stock exchange. characteristics.
A. True A. five
B. False B. seven
C. three
427. the ability to produce more of a product
D. none of above
than another country using the same re-
sources 431. Under perfect competition, price is deter-
A. absolute advantage mined at
B. comparative advantage A. Equilibrium price of the industry
C. imports B. Equilibrium price of the firm
D. exports C. when MC = MR
D. All of these
428. Which of the following is NOT a Market
Structure? 432. All of the following are examples of non-
profits EXCEPT:
A. Make a Wish Foundation
B. Red Cross
C. Salvation Army
D. Walmart
433. The four market structures are

A. Perfect competition.Monopoly. Com-
petition. Oligopoly.
B. Perfect competition.Monopoly. Monop-
olistic competition.Oligopoly.
C. Perfect monopoly.Monopoly. Monopo-
B. Oligopoly listic oligopoly.Oligopoly.
C. Monopoly D. none of above
D. Corporation 434. Which of the following is a non price
strategy?
429. In a market that is in Perfect Competition,
you would normally find A. Predatory Pricing
A. few barriers to entry-easy to en- B. Limit-pricing
ter/exit the market C. Promotion
B. difficulty in entering the market D. Collusion

435. Gabrielle, Zalyn, and Aaron each have 439. An owner who cannot pay the bills may
their own sole proprietorship in the mar- be forced to sell personal assets, as well
ket for cakes. Together, they decide that as those of the business, to pay debts
none of them will sell cakes for less than
$50, causing the market price of cakes to
go up. Which type of market structure are B. Partnership
they probably doing business in? C. Corporation
A. purely competitive D. none of above
NARAYAN CHANGDER
B. monopoly
440. What type of monopoly is based on own-
C. monopolistically competitive
ership of a manufacturing method or other
D. Oligopoly scientific process?
436. A market structure in which only one
seller sells a product for which there are
no close substitutes is called a
A. monopoly
B. oligopoly
C. trust
D. none of above
A. Geographic monopoly
437. What is the equilibrium wage in the mar-
ket? B. Natural monopoly
C. Government monopoly
D. Technological monopoly
441. Which option below is NOT a characteris-

tic of Monopolistic Competition?
A. Many sellers sell similar but not stan-
dardized products
A. 8
B. Few firms hold large market shares
B. 16
C. One of the most common market struc-
C. 4
tures
D. 20
D. Uses non-price competition
438. State or federal laws that regulate big
business and labor unions to prevent or 442. Select the correct monopoly:Baltimore
dismantle monopolies. Orioles Baseball
A. Zoning Laws A. Government Monopoly
B. Patent B. Technological Monopoly
C. Collusion C. Geographical Monopoly
D. Anti-Trust Legislation D. Natural monopoly

443. What type of economic system does the A. Produce until MC = price
United States exist on? B. Produce until AC = price

A. Traditional C. Produce until MR is zero
B. Market D. Sell as much as it can produce
C. Command
D. Mixed
a cartel?
444. Which of the following is not a type of A. NAFTA
monopoly?
B. ASPCA
A. Natural
C. OPEC
B. Geographic
D. IRS
C. Technological
450. Your family can only get electricity or
D. Government
natural gas to their home through one
E. Environmental provider. There is no other option. This
is an example of
445. This means is there any difference be-
tween the products sold by the sellers in A. monopoly
the market for the good? B. monopolistic competition
A. regulation C. oligopoly
B. price wars D. perfect competition
C. product differentiation
451. Disadvantages include unlimited liability,
D. barriers to entry difficult to raise financial capital, difficulty
446. Pollution released from a factory is an ex- attracting qualified employees, limited life
ample of a Externality A. Sole Propriotorship
A. Negative B. Partnership
B. Neutral C. Corporation
C. Positive D. none of above
D. none of above
452. There are fewer firms in Perfect Compe-
447. The cross elasticity of demand for sub- tition than in Monopolistic Competition
stitutes will always be negative because A. true
the when the price of product A increases
B. false
the quantity demanded of product B also
increases 453. In competitive markets
A. TRUE A. The products sold are different de-
B. FALSE pending on the firm selling the product.
448. The price that a firm obtains for its prod- B. It is hard for a seller to enter the mar-
uct is not affected by the volume of goods ket due to barriers to entry
it produces. What should it do to maximise C. Firms will leave the market if they are
profits? making economic profits.

D. Buyers can expect to find consistently C. PURE COMPETITION

low prices and wide availability of the D. PERFECT COMPETITION
goods that they want.
458. Markets like automobiles, cell phones, ca-
454. Regardless of market, a firm will maxi- ble TV, and internet providers are exam-
mize profit where: ples of which market structure?
A. MR = MC A. Monopoly
B. MR = ATC B. Oligopoly
NARAYAN CHANGDER
C. MR = min ATC
459. Oligopolistic pricing strategy most likely
D. P = ATC results in a demand curve that is:
E. P = MC A. kinked.
455. A Cartel’s illegal actions of restraining B. vertical.
competition by controlling prices and fix- C. horizontal.
ing production quotas is known as
D. none of above
460. Which of the following is true of the

monopoly structure?
A. Monopolies tend to generate high prof-
its, have high barriers of entry, and not
have significant competition.
B. Monopolies tend to generate high prof-
its, have high barriers of entry, and have
A. Networking significant competition.
B. Strategizing C. Monopolies tend to generate high prof-

its, have low barriers of entry, and not
C. Monopolizing have significant competition.
D. Collusion D. none of above
456. Which type of market structures has 461. The socially optimal point on this graph
many producers (companies) and sell sim- would be at point
ilar but not identical products from each
other? These companies have some con-
trol over the price and there are low bar-
riers to entry.
C. oligopoly
D. monopoly
457. ONE SELLER DOMINATES THE MARKET A. J

A. MONOPOLY B. F
B. OLIGOPOLY C. L

D. G C. Factor Market, Product Market,

E. K Households, Firms

D. Factor Market, households, Stock Mar-
462. The reason excess capacity occurs in ket, super market
a monopolistic competitive market is be-
cause of the company 467. When the U.S. sells and ships goods to
A. Using advertising media to introduce another country.
the product A. imports
B. Setting a price lower than marginal B. exports
cost
C. shipment
C. Produces its output not at the lowest
average total cost level D. none of above
D. Producing output whose demand is
468. The State of California filed suit against
perfectly elastic
three pharmaceutical companies, Eli Lilly,
E. Dealing with the demand for goods is Novo Nordisk, and Sanofi, which supply
inelastic 90% of global insulin. Which market struc-
ture does this most closely resemble?
463. Which type of competition only allows a
few firms to operate in the market? A. Perfect Competition
A. Oligopoly B. Monopolistic Competition
B. Pure Monopoly C. Monopoly
C. Perfect Compeition D. Oligopoly
469. Pure Competition
464. The FTC does not allow mergers. A. Includes well informed buyers and sell-
A. True ers of exactly the same economic product.
B. False B. Market structure with many buyers
and sellers, differentiated products, per-
465. The effort by sellers to agree to secretly fect information, and restricted entry and
set production levels or prices is called exit.
A. cartel C. Market structure with few buyers and
B. antitrust sellers, differentiated products, imper-
fect information, and restricted entry and
C. price leadership
exit.
D. collusion
D. Market structure with few buyers and
466. What are the four main parts of the cir- sellers, homogeneous products, perfect
cular flow diagram? information, and free entry and exit.
A. Product Market, Stock Market, Factor 470. Economists define market structure
Market, Fish Market according to four main characteris-
B. Product Market, House Market, Factor tics:number of producers, similarity of
Market, Good Market products, ease of entry, and

C. Technological monopoly
D. Geographic monopoly
474. This firm will have an excess capacity of
A. Brand Loyalty
B. Control over Prices
NARAYAN CHANGDER
471. A market structure is one in which

barriers to entry are low and many firms
compete by selling similar, but not identi-
cal products.
A. 0, it is perfectly efficient
B. 120.
C. 280.
D. 160.
E. 70.
475. Predatory pricing

A. sets the market price below cost levels
for the short term to drive out competitors
B. sets the market price above cost levels
for the short term to drive out competitors
A. a Cartel C. sets the market price below cost levels

for the long term to drive out competitors
B. Limited Liability Partnership
D. sets the market price above cost levels
C. Monopolistic Competition for the long term to drive out competitors
D. Pure Competition
476. conspiring among business to set the
472. A monopoly based on the absence of prices of competing production
other sellers in a certain location is called
A. pricing fixing
A. an oligopoly
B. trust
B. a geographic monopoly
C. market share
C. a natural monopoly
D. oligopoly
D. a locational monopoly
477. SSEMI3 b Perfect competition is some-
473. Exists when there are economies of scale times called “Pure” competition because:
A. Natural monopoly A. Products are identical and price is
B. Government monopoly purely set by the market

B. A government agency sets price floors prices, and it affects competition by pro-
for all products in that market moting lower prices for consumers.

C. A few large firms dominate the market D. Market power is the ability of a firm to
with their slightly differentiated products have no influence on the market price of a
D. There is only one seller, so the compe- good or service, and it affects competition
tition is perfect by promoting fair competition.
481. Rebels in Angola had this type of

478. What is this chart called?
monopoly over diamonds because they
controlled the mines
A. Franchise
B. Patent/Copy Right
C. Natural Monopoly
D. Resource monopoly
482. Which of the following is not an advan-

A. Demand Curve tage of a sole proprietorship?
B. Quantity Curve A. easy to form
C. Demand Schedule B. taxed only once
D. Equilibrium Chart C. you retain all of the profits
D. unlimited liability
479. Strong interdependence exists in this
market (meaning what one firm does the 483. What type of monopoly is based on own-
others will do as well): ership of a manufacturing method, process,
A. Perfect competition or scientific advancement?
B. Monopolistic competition A. technological monopoly
C. Oligopoly B. geographic monopoly
D. Monopoly C. government monopoly

D. natural monopoly
480. What is market power and how does it
affect competition? 484. SSEMI3 b Comcast and Wow control ba-
A. Market power is the ability of a firm sically all of the market share for cable in-
to influence the market price of a good or ternet in Martinez, GA. This is an example
service, and it affects competition by al- of a(n):
lowing the firm to set higher prices and A. Monopoly
restrict output. B. Oligopoly
B. Market power is the ability of a firm to C. Monopolistic Competition
lower the market price of a good or ser-
vice, and it affects competition by increas- D. Perfect Competiton
ing consumer choices. 485. Utility companies such as electricity
C. Market power is the ability of a firm to would be an example of which type of
collaborate with other firms to set market monopoly?

A. natural monopoly 490. Which 2 Market Structures have the high-

B. geographic monopoly est barriers to entry? (pick 2!)
C. pure monopoly A. Oligopoly
D. technological monopoly B. Monopolly
486. Price movements at Disequilibrium when C. Perfect Competition

there is a shortage ? D. Monopolistic Competition
A. Expansion along Demand, Contraction
NARAYAN CHANGDER
along Supply 491. Which of the following best describes an
oligopoly?
B. Expansion along Demand & Supply
A. many monopolistically competitive
C. Contraction along Demand & Supply
firms
D. Contraction along Demand, Expansion
B. a few firms sharing monopoly power
along Supply
C. a former monopoly that has been bro-
487. SSEMI3 The financial responsibility for ken up by the government
paying the debts of a business can be
called: D. a government-granted franchise or
monopoly
492. The jeans industry would fall into what

type of market structure? ( jeans are sim-
ilar but there are some differences in the
product)
A. monopoly
B. oligopoly
A. taxation 493. Under perfect competition,

B. stock A. products are similar but not identical
C. dividend B. numerous restrictions prevent firms
D. liability from entering the market
C. no seller can sell a product above the
488. Antitrust laws promote competition.
prevailing market price
A. True
D. a single seller can affect price
B. False
494. Labor, Capital, Natural Resources
489. Ideal market structure
A. Perfect Competition A. ethics
B. Nonprice Competition B. economics
C. Predatory pricing C. Factors of Production
D. Product Differentiation D. Gross Domestic Product (GDP)

495. Mammoth Inc. sells computers in a C. oligopoly

monopoly market.Which of the following D. perfect competition
is true about this market?

A. There is a single firm selling a product 499. Monopolistic competition is characterized
with no close substitutes. by
B. There are no, or low, barriers to entry A. A large number of firms.Easy entry into
in this market. the industry. Differentiated products.
C. Price equals marginal revenue. B. A large number of firms.Easy entry into

the industry. Similar products.
D. The firm earns zero economic profit in
the long run. 500. In this market, there is no entry possible:
E. The seller can charge any price they A. Perfect competition
want. B. Monopolistic competition
496. According to the payoff matrix, what will C. Oligopoly
YELLOW do if white goes high? D. Monopoly
501. A market in which there are many buy-

ers but only one seller and barriers to en-
try prevent other firms from entering the
market are known as
A. high
B. low
497. Which of the following is NOT a charac- A. Oligopoly

teristic of a monopoly? B. Collusion
A. barriers to entry C. Monopoly
B. one seller D. Monopolistic Competition
C. one buyer
502. Price elasticity of supply is the respon-
D. a product without close substitutes siveness of
498. bottled water A. demand to a change in price.
B. price to a change in supply.
C. quantity supplied to a change in price.
D. price to a change in supply.
503. an agreement among firms to charge one

price for the same good
A. monopoly A. price fixing
B. monopolistic competition B. collusion

C. price discrimination C. difficult entry and exit from market

D. cartel D. none of above
504. The Demand Curve has moved right. 508. Which of the following is a disadvantage
Where is the new equilibrium price and of corporations:
quantity?
A. High taxes
A. Higher, higher
B. Unlimited liability
B. Lower, lower
NARAYAN CHANGDER
C. Unlimited life
C. Lower, higher
D. financial power
D. Higher, lower
509. division of customers into groups based
505. SSEMI3 The Board of Directors of a cor-
on how much they will pay for a good
poration is elected by who?
A. Shareholders A. price discrimination
B. CEO B. price fixing
C. Principal C. grouping
D. None of the above D. proportional payments
506. The Organization for Petroleum Export- 510. The benefit or satisfaction gained from
ing Countries often uses their market using a good or a service is called
power tobenefit themselves at the ex- A. goods
pense of the rest of the world. These
13 countriescontrol 73% of the world’s B. incentives
oil reserves and 40% of total world oil C. producer
production. Thenations meet annually to
discuss how much oil they will produce D. utility
that year and whothey will sell it to,
which strongly determines the price of oil 511. Which of the following market types has
in the entire globaleconomy. In 1973 the fewest number of firms?
OPEC set an embargo on oil exports to the A. Monopolistic competition
United States cripplingthe American econ-
B. Monopoly
omy.How would you characterize the oil
market? C. Oligopoly
A. Perfect Competition D. Perfectly Competition
512. Water has seen an increase in demand
C. Oligopoly 8% this summer, while the price has de-
D. Monopoly creased 12%
A. 1.5 inelastic
507. Which of these isn’t a condition of perfect
competition? B. 1.5 elastic
A. many buyers and sellers C. .67 inelastic
B. identical products D. .67 elastic

513. Many sellers, differentiated products C. 5

A. Perfect Competition D. 8

519. a market is
C. Oligopoly
A. where goods/services are exchanged
D. Monopoly
by buyers/sellers
514. When a major car company lowers its B. anything that prevents the flow of
prices, other car makers will probably goods and services imported
A. maintain existing prices
C. the ability to produce more of a prod-
B. go out of business uct than another country using the same
C. raise their prices resources
D. lower their prices D. the ability to produce a product with
lower opportunity costs than another
515. If you buy abondfrom a corporation, you country
A. are one of the company’s many own-
ers. 520. Fixed costs change with the amount of
output for a business.
B. benefit only if the company earns a
profit. A. True
C. are a creditor of the corporation-you B. False
have loaned the company money.
C. It depends on the type of business
D. are an investment banker. Explanation:Fixed costs stay the same no
516. Pure / perfect competition and monop- matter how much or little output a busi-
olistic competition are the same because ness has.Variable costs change as output
increases or decreases.
A. They have unique products. D. none of above

B. The have identical products. 521. Airlines are examples of
C. They have many buyers and sellers.
A. purely / perfectly competitive mar-
D. They have many buyers. kets.
517. Type of Monopoly is based on Laws and B. monopolies.
regulations C. oligopolies.
A. Natural
D. monopolistic competition.
B. Government
C. Technological 522. It is the oldest form of business organi-
zation and the most common
D. Geographic
518. How many different types of monopolies
are there? B. Partnership
A. 10 C. Corporation
B. 4 D. none of above

523. which one of these government actions is 528. The disadvantages of this business or-
NOT part of Regulation? ganization include unlimited liability, diffi-
culty raising financial capital, difficulty at-
A. Eliminating licenses and other barriers
tracting qualified employees, and having a
to entry
limited life
B. Breaking up monopolies and trusts A. Sole Propriotorship
C. Blocking mergers that may create un- B. Partnership
fair market conditions
C. Corporation
NARAYAN CHANGDER
D. Challenging business practices that D. none of above
limit competition
529. What is the main difference between mo-
524. Public utilities are an example of a nopolistic competition and oligopoly?
monopoly. A. the prices
A. technological B. the barriers to enter facing new firms
B. natural C. advertising
C. government D. monopoly
D. geographic 530. In this market structure there are many

buyers and sellers with identical products
525. Which is NOT considered an unfair busi- A. perfect competition
ness practice?
A. Price fixing
C. monopoly
B. Market allocation D. oligopoly
C. Predatory pricing
531. What happens to a monopolistically com-
D. Competitive pricing petitive firm that begins to charge an ex-
cessive price for its product?
526. Reduced or removes government control A. The firm will go out of business.
of business
B. Consumers will substitute a rival’s
A. Regulation product.
B. Deregulation C. Consumers will boycott the product.
C. Public Disclosure D. The government will regulate the
price.
D. Market Structure
532. Mira and Lesley are interested in starting
527. It is the impact of one’s behavior on a by- a nail salon.
stander.
A. demerit good
B. negative externality
C. positive externality
D. externality

A. Sole-Proprietorship C. Price of Complementary Products

B. Partnership D. Consumer Sentiment

C. Corporation 538. This market structure has many firms,
D. none of above identical products, no barriers to entry, &
price takers
533. pure competition and monopoly are
A. the same
B. Monopoly
B. almost the same
C. should not be compared 539. Monopolies can control the price of a
product because
D. opposites
534. government issued right to operate a

business
A. license
B. franchise
C. patent
D. price discrimination A. They are evil.
535. *New landscaping in neighbor’s yard? B. They are illegal.
C. The have a unique product.
D. The government supports them.
540. A price ceiling of $20 would benefit
A. Negative externality
B. Positive externality
536. The most extreme form of imperfect com- A. consumers

petition: B. suppliers
A. Perfect Competition C. both
B. Monopolistic Competition D. none of above
C. Oligopoly 541. Which of the is an example of a legal
D. Monopoly monopoly?
537. Which is not a supply side Non-Price Fac- A. Yahoo

tor? B. Prescription drugs
A. All of the above C. Disney World
B. Price of Substitutes D. none of above

542. Which market structure did the DeBeers 547. What is not a requirement for the law of
Diamond industry fall under? diminishing returns to operate in the short
run?
A. Monopoly
A. Average returns to a variable factor
B. Oligopoly will increase then fall.
C. Perfect Competition B. Inputs of all of the factors will be vari-
D. Monopolistic Competition able.
C. At least one factor will be fixed in quan-
NARAYAN CHANGDER
543. As the price goes up, what happens to tity.
the quantity demanded?
D. Marginal product of a variable factor
A. Increases will increase then fall.
B. Decreases 548. What is the most common form of busi-
ness?
544. One of the defining characteristics of a
A. Partnership
perfectly competitive market is
B. Corporation
A. A small number of sellers
C. LLC
B. A large number of buyers and a small
D. Sole Proprietorship
number of sellers
549. Who defined economics as an inquiry into
C. An identical product
the nature and causes of the wealth of na-
D. Significant advertising by firms to pro- tions?
mote their products A. Adam Smith
545. what condition is present in perfect com- B. John Stuart Mill
petition but missing in monopolistic compe- C. Jean Stuart Mills
tition? D. Alfred Marshall
A. marginal analysis
550. describes buyers and sellers in com-
B. identical products petitive markets that must accept the price
the market determines.
C. freedom of entry and exit
D. very large number of buyers and sell-
ers
546. John opens a bubble tea shop in his neigh-

bourhood. As the trend of drinking bubble
tea rises, more similar shops started open-
ing. What will happen to John’s demand
curve?
A. No change
A. Monopolies
B. Shifts right B. Price Makers
C. Shifts left C. Cartels
D. none of above D. Price Takers

551. A merger that joins companies that pro- B. opportunity cost

duce very similar products is called
C. private property

A. conglomerate.
D. imperfect competition
B. vertical merger.
C. horizontal merger. 556. The fast food hamburger restaurant in-
dustry is a great example of a monopolis-
D. corporation.
tically competitive industry because each
552. On an average shopping trip, a con- restaurant has a on their own brand
sumer’s eye lingers on a product for only even though they all sell hamburgers of
about 2.5 seconds. In order to stay com- some kind.
petitive, companies experiment with new A. monopoly
formulas, along with the color and size of
the product’s packaging. These research B. oligopoly
and development costs can range from C. competitive advantage
$100, 000 for adding a new color to an
existing product line to millions of dollars D. subsidy
for the creation of a new product. Accord-
ing to the passage, companies are trying 557. Is the first market structure incorporated
to compete through or unincorporated?
A. economies of scale A. incorporated
B. collusion B. unincorporated
C. price-fixing
558. Why doesn’t the market system work
D. non-price competition to provide street lighting and other public
553. Mr. Simpson is liable for all the debts of goods?
his company. Mr.Simpson has which type A. Too few of these services are avail-
of business organization? able.
A. sole proprietorship B. Important needs cannot be left to
B. monopoly chance.
C. perfect competition C. Voters put pressure on local govern-
D. corporation ments.
D. There is no easy to charge individual
554. There are few sellers in this market
users.
B. Monopolistic competition 559. SSEMI3 b Mr. Coleman has only one
choice (GA POWER) for electricity at his
C. Oligopoly
house, Ga Power. This is an example of a
D. Monopoly
A. Technological Monopoly
555. What is the term used to describe a fac- B. Monopoly
tor that prevents a firm from entering into
the market? C. Oligopoly
A. barrier to entry D. none of above

560. which of the following is NOT an 564. Why is it important to understand differ-
oligopoly regulation ent market structures?
A. no collusion A. To study the dynamic world of eco-
B. no price fixing nomics
C. no cartels B. To gain insights into pricing and con-
sumer choices
D. no different pricing
C. To comprehend how businesses oper-
561. to reduce regulations
NARAYAN CHANGDER
ate and compete
A. deregulate D. All of the above
B. lower tax rates
565. True or False:The US government has no
C. declassify
laws against unfair competition in the mar-
D. anti-trust laws ket.
562. Firms in a Monopolistic Competition type A. True
of market are competing firms that have B. False
no economies of scale, yet they have some Explanation:The Antitrust Division has
control over , but must charge or more civil antitrust lawsuits in litigation
lose business to their competitors. than at any time in recent memory, and
several mergers have been abandoned af-
ter they attracted the Division’s scrutiny.
566. In which market structure is a firm the

“price setter?”
A. monopoly
B. oligopoly
A. price, competitive prices
D. perfect competition
B. factors of production (FOP), late fees
C. production, equilibrium price 567. Which term describes the ‘unseen’ barri-
ers to advancement?
D. the supply chain, fees and offer dis-
counts A. Price Floor
B. Equilibrium Wage
563. Even though they create a monopoly po-
sition, patent rights benefit society, in the C. Price Ceiling
form of: D. Glass Ceiling
A. Patents make selling prices cheaper
568. Which of the following markets does NOT
B. Patents prevent one company from
allow firms any market power?
controlling key inputs
A. Perfect Competitive
C. Patents reduce inefficiencies
B. Pure Monopoly
D. Patents encourage creative behavior
E. Patents can be owned by anyone, not C. Oligopoly
just the government. D. Monopolistic Competition

569. Follows these conditions:many buy- C. Only one firm produces unique prod-
ers/sellers; all sell same product; buy- ucts, having complete control over prices
ers/sellers are informed; free market en- and production

try/exit D. Sellers and buyers are well informed
A. perfect competition and there are no barriers for entry or exit
B. monopolistic competition 573. Price ceilings are always equilibrium
C. oligopoly price.
D. monopoly A. above
B. below
570. Joe is starting a small home-based con-
sulting business. He possesses computer C. equal to
knowledge but lacks marketing skills. He D. none of above
will need to hire someone for that. The
form of business ownership that Joe might 574. In which market structure do firms have
consider establishing is a(n) no control over the price of their products?
A. sole proprietorship A. Monopoly
B. corporation B. Perfect competition
C. monopoly C. Oligopoly
D. partnership. D. Monopolistic competition
571. Marlee has just graduated Law School 575. Which of the following has two sellers
and is considering opening her own law and many buyers?
practice. A. monopsons
B. duopoly
C. oligopoly
576. Ramon decided to open his own software

business. He borrowed money from a
bank to buy computers and office equip-
A. Sole-Proprietorship ment, and he hired one assistant. What
is one DISADVANTAGE of Ramon’s type of
B. Partnership
business organization?
C. Corporation
A. limited liability
D. none of above B. ease of start-up
572. What is the main characteristic of monop- C. flexibility
olistic competition? D. unlimited liability
A. Firms produce identical products and
have no control over prices 577. Would car companies be in the oligopoly
industry
B. Firms produce similar, but not identi-
cal products, resorting to non-price com- A. Yes
petition B. No

578. A central bank will most likely allow the C. Identical product theory
economy to self-correct in periods of: D. Price War
A. high inflation, fast economic growth,
and low unemployment. 583. There are many buyers AND sellers in this
market structure.
B. low inflation, slow economic growth,
and high unemployment. A. monopoly
C. high inflation, slow economic growth, B. monopolistic competition
NARAYAN CHANGDER
and high unemployment. C. oligopoly
D. none of above D. pure/perfect competition
579. All of the following are good things about 584. Which is not a demand side Non-Price Fac-
competition in a market EXCEPT tor?
A. requires some firms to receive larger A. All of the above
subsidies B. Technological Change
B. keeps prices down C. Price of Inputs
C. ensures managers of firms take good D. Climactic Conditions
care of our valuable resources
D. fosters production of products that will 585. Barriers to Entry:Are there any obstacles
actually make our lives better that prevent other firms from entering the
market for the good? If barriers are weak
580. Which of the following is an example of or absent from the market, the market will
a merger? be more
A. An individual buys a franchise. A. competitive
B. Two individuals form a partnership. B. monopolistic
C. A company sells bonds to raise money C. saturated
for expansion. D. unprofitable
D. A company combines with a company
that supplies it with raw materials. 586. The government does not regulate merg-
ers between private companies.
581. Which is the market in which supply and A. True
demand establish the market price?
B. False
B. Monopolistic competition 587. The characteristics of MONOPOLY are
C. Oligopoly A. price takers
D. Monopoly B. unique good/product

C. price maker
582. a product, such as petroleum or milk, that
is considered the same no matter who pro- D. high barriers
duces or sells it 588. Business organization that has the least
A. Commodity difficulty raising money
B. Identical Assets A. corporation

B. partnership 594. Which situation is most likely to lead to

the lowest prices?
C. wholesalers

A. There is only one producer making the
good.
589. monopoly created and/or owned by the B. Businesses secretly agree to share
government their profits.
A. government monopoly C. Competition between businesses is
B. monopoly prohibited.
C. economies of scale D. Several producers compete to sell

goods to the public.
D. public monopoly
595. Most large businesses are
590. Public utilities are an example.
A. corporations.
B. cooperatives.
B. Natural Monopoly
C. general partnerships.
D. sole proprietorships
D. Oligopoly
596. Pure / perfect competition and monopo-
591. A monopolist’s demand curve will be hor- listic competition are the same because
izontal at the market price.
A. TRUE
B. FALSE
592. Which of the following industries have

been deregulated in recent years?
A. low cost housing
A. They have unique products.
B. pharmaceuticals
B. The have identical products.
C. steel
C. They have many buyers and sellers.
D. airlines
D. They have many buyers.
593. DeBeers has a monopoly in the diamond
market because it 597. A product that is the same no matter who
produces it such at gasoline, notebook pa-
A. They have a patert of the excavation
per, milk, etc. Commodity’s are sold in per-
process for diamonds
fectly competitive markets.
B. is a natural monopily
A. Good
C. ihas been granted a government li-
B. Service
cense
C. Commodity
D. bought up a significant portion of dia-
mond reserves D. Perfect Product

598. Which TWO market structures have high 603. This type of monopoly exists because it
barriers to entry? is efficient to allow one producer to be the
A. perfect competition only provider. Xcel energy being the sole
provider of electricity in my neighborhood
B. oligopoly is an example of this.
C. monopoly A. Franchise
D. monopolistic competition tagsSSEMI3 B. Patent/copy right
NARAYAN CHANGDER
599. What level of government is most closely C. Natural Monopoly
associated with zoning? D. Resource Monopoly
A. federal 604. Governmental Regulatory Agency in
B. state charge of Clean air and water
C. local A. FDA
D. interstate B. EPA
C. FTC
600. A monopoly that is based on the owner-
ship or control of a manufacturing method, D. SEC
605. Oligopoly is a market structure with one
A. geographic monopoly very large firm
B. natural monopoly A. True
C. government monopoly B. False
D. technological monopoly 606. During the contraction phase of a busi-
ness cycle, it is most likely that:
601. Police protection is an example of a
good and apples are an example of a A. inflation indicators are stable.
good. B. aggregate economic activity relative
A. Public; Private to potential output is decreasing.
B. Private; Public C. investor preference for government
securities declines.
C. Public; Public
D. none of above
D. Private; Private
602. What are the advantages of a monopoly? a natural monopoly?
A. Increased consumer choice, lower A. bananas
prices, and fair competition.
B. public water
B. Greater innovation, improved quality,
C. grocery stores
and increased efficiency.
D. running shoes
C. More job opportunities, economic
growth, and market stability. 608. Decision making can be slow and compli-
D. Ability to set higher prices, control the cated because so many levels of manage-
market, and enjoy higher profits without ment are involved
competition. A. Sole proprietorship

B. Partnership A. Where their Marginal Cost (MC) equals

C. Corporation Marginal Revenue (MR) equals Average
Cost (AC) equals Average Revenue (AR)

D. none of above
B. Where their Marginal Cost (MC) equals
609. Which market structure is characterized Marginal Revenue (MR) and Marginal Cost
by a large number of small firms produc- is rising
ing identical products?
C. Where their Average Revenue (AR)
A. Perfect Competition equals Total Revenue (TR) and Quantity
B. Monopolistic Competition (Q) equals Price (P) times Quantity (Q)
C. Oligopoly D. Where their Quantity (Q) equals Price

(P) times Quantity (Q) and Quantity (Q)
D. Monopoly equals Price (P)
610. Is the third market structure in question
615. What market structure if price is the key
#2 incorporated or unincorporated?
for competing with other firms?
A. Incorporated
A. Monopoly
B. Unincorporated
B. Oligopoly
611. The thing businesses are aiming for.
A. profit
B. revenue
C. costs 616. Kraft and Unilever control 87% of the
mayonnaise market. This is an example
D. stars of
612. The real or imagined differences between
competing products in the same industry.
A. Nonprice competition
B. Product differentiation
C. Marketing differential
D. Oligopoly
A. Monopoly
613. A market in which there are a lot of firms B. Monopolistic competition
that produce identical products.
D. Oligopoly
B. monopoly
Explanation:In a monopoly, only one com-
C. monopolistic competition pany dominates the market.An oligopoly
D. oligopoly exists when a small number of compa-
nies control most of the market.In a
614. Mia, Aria, and Oliver are running lemon- perfectly competitive market there are
ade stands in a perfectly competitive mar- many producers and none can control the
ket. What is the long-run equilibrium posi- market.In monopolistic competition, firms
tion of their stands? have only modest control in the market.

617. In a sole proprietorship, liability is 623. Which two products would be an exam-
A. General ple of a complement?
B. Limited A. Cereal
C. Unlimited B. Milk
D. There is no liability. C. Soy Sauce

D. Sharpie Markers
618. The federal law that first outlawed price
624. What is a Sole Proprietorship?
NARAYAN CHANGDER
discrimination was the
A. Federal Trade Commission Act A. Business owned by president
B. Clayton Antitrust Act B. Business owned by several companies
C. Sherman Antitrust Act C. Business owned by one person
D. Robinson-Patman Act D. Business owned by a company
619. markets where many businesses sell the 625. Few sellers and many buyers is character-
same products istic of
A. perfect competition A. monopoly
B. monopolistic competition B. monopolistic competition
C. oligopoly C. oligopoly
D. monopoly D. none of above
620. The government’s job in a free market 626. Which allows increasing returns to occur
economy is to with production?
A. tell people and business what to do A. increasing costs
B. control who buys what B. worker specialization
C. control who sells what C. underutilization
D. make sure all businesses are run fairly D. fixed resources
621. Identify type of monopoly:Public utilities 627. The unemployment rate has de-
creased.9% in the last year, meaning that
A. Natural Monopoly
more individuals are either finding work
B. Technological Monopoly or have given up looking for jobs. Is this
C. Geographical Monopoly a microeconomic issue or macroeconomic?
D. Government Monopoly A. microeconomic
B. macroeconomic
622. Business model in which profits are taxed
when they are earned and again when 628. What market structure would agricul-
they are paid out to owners. tural products fall into?
A. sole proprietorship A. perfect (pure) competition
B. partnership B. monopolistic competition
C. corproation C. oligopoly
D. none of above D. monopoly

629. Public utilities are an example of? 634. Which market structure involves selling
A. A competitive market “similar” products and there are SEVERAL
firms involved.

B. Natural Monopoly
C. Monopolistic power
B. Monopoly
D. Oligopoly
C. Oligopoly
630. Which statement below is NOT true D. Monopolistic Competition
about monopolies
A. All monopolies are harmful
is that
B. Businesses in monopolies are ‘Price
Makers’
C. Only one seller sells a product with no
close substitutes
D. The least competitive market structure
is a monopoly
631. Which of the following can be done by A. products are high priced
the government to discourage the use of B. there are several close substitutes for
demerit goods? the product
A. impose a higher tax on these goods C. there is a unique product with no close
substitutes
B. Set a minimum age for the consump-
tion of these goods D. the product cannot be produced by
small firms
C. Inform the people about the negative
effects of consuming these good 636. Due to the nature of its business struc-
D. Impose a total ban on the production ture, a is the most complex form of
& consumption of these goods business organization and a legal entity
unto itself.
632. Collusion and price fixing can become a
problem in this type of market structure
A. Monopoly
B. Oligopoly
D. Perfect Compeition
633. Costs that do not change when the A. Oligopoly

quanity of output produced changes? B. Monopoly
A. Fixed Costs C. Partnership
B. Variable Costs D. Corporation
C. Explicit Costs 637. What is a characteristic of a perfectly
D. Implicit Costs competitive market?

A. Producers have market power 642. What do oligopolies and monopolistically

B. Products are unique competitive markets have in common?
A. both have low barriers to entry
C. Entry into the industry is difficult
B. many sellers
D. Products are identical
C. both have some control over the price
638. If Amazon pays workers $15/hour, D. all businesses are corporations
higher than competitors, how would they
feel about increasing minimum wage to 643. It has four categories:natural, geo-
NARAYAN CHANGDER
$15/hr? graphic, technological, government
A. favor the new regulation A. Perfect Competition
B. oppose the new regulation B. Monopolistic Competition
C. Oligopoly
639. Which planet is the smallest?
D. Pure Monopoly
A. Mars
B. Venus 644. Sarah Grace decides to open a boutique.
She is surprised at how easy she was able
C. Mercury to get started. In a few days, she is open
D. Saturn for business and selling a lot of her inven-
tory, even though there are five other suc-
640. SSEMI3 Which business organization is a cessful boutiques in town. Based on this
firm legally owned by two or more peo- scenario, which of the following is proba-
ple? bly NOT true?
A. Sole Proprietorship A. Since she faced few barriers to entry,
B. Corporation the market is probably not perfectly com-
petitive.
C. Partnership
B. Since there are other sellers who are
D. Oligopoly able to make a profit, it’s probably not a
641. If this graph is for a monopolistically com- monopoly.
petitive firm, it best represents C. Since all the stores are not selling the
exact same products, it is probably not
pure competition.
D. Since the boutique has competition, it
probably has good customer service.
645. In summer 2012 New Braunfels expe-
rienced large crowds of tourists on the
Guadalupe and Comal Rivers. Those
crowds generated large amounts of trash.
A. short run economic loss. What term describes this condition?
B. short run extra-normal profit. A. Positive externality
C. long run economic profit. B. Negativen Externality
D. long run equilibrium at normal profit. C. Monopoly
E. short run accounting loss. D. Spillover benefit

646. Fixed Costs are only fixed in the 651. T or F Would Pepsi and Coke conspire to-
gether to make prices?
A. Long run
A. True

B. Short run
B. False
C. Period where there is neither a profit
or a loss 652. A monopolist is a
A. Price maker
B. Price taker
647. Draw a labor market diagram shift. C. Price adjuster
Google decides it wants expands its busi-
ness and hire more workers. What hap-
pens to wages and quantity? 653. What is the relationship between price
A. Both Increase and quantity supplied in a monopolistic
competition market?
B. Wage Increases and Quantity De-
A. No relationship
creases
B. Inverse
C. Both Decrease
C. Negative
D. Wage Decreases and Quantity In- D. Positive
creases
654. How is a General Partnership organized?
648. Is education a good? A. All partners have full responsibility for
A. no, it is a product any debts and liability.
B. yes, it is an intangible good B. Only one partner is responsible for the
debts of the partnership.
C. no, it is a service
C. No partner is responsible for the debts
D. yes, it is a tangible good of the partnership beyond his/her invest-
ment.
649. Businesses and inventors are able to ap-
D. Every partner must be specialized and
ply for a in order to protect themselves
only controls a part of the business.
from competitors copying their technology
Explanation:General partners all partici-
A. trademark pate in the running of the business and are
equally responsible for all debts and de-
B. copyright
cisions.In a Limited Liability Partnership,
C. trust only one partner is responsible for the
D. patent debts of the partnership and has a say in
how the business is run. The other part-
650. In which market structure is there the ners provide capital resources but have
LEAST competition? no say in the daily operations.
A. Monopoly 655. Which of the following is a price strategy,

where groups get together to set prices
B. Oligopoly even though they might be competitors?
C. Monopolistic Competition A. Collusion
D. Perfect Competition B. Price discrimination

656. Government in the country determines 661. What is an example of a substitute?

how all 4 questions are answered and key
A. Car for a truck
industries, such as transportation and com-
munication, are owned and operated by B. Rocks for a bike
the government. C. Computers for a shovel
A. Socialism D. Cell phone for boat
B. Communism
662. What determines the price that a price
NARAYAN CHANGDER
C. Mixed-Economy taker firm charges in a perfectly compet-
D. Free Market itive market?
A. The efficiency of the firm’s operations
657. Most of the companies that you will buy
products/services from will fall into these B. The intersection of the Market De-
two categories. mand and Market Supply curves
A. Monopoly/ Monopolistic competition. C. The firm’s desire for profit
B. Monopoly/ Oligopoly D. The demand curve faced by the firm
C. Perfect competition/ Oligopoly 663. Which of the following is endless in na-
D. Oligopoly/ Monopolistic competition ture?
A. resources
658. ATC x =TC
B. goods
A. Variable Cost
C. economic ideas
B. Quantity
D. wants
C. Price
D. None of the Above 664. Advantages of a monopoly
A. Monopolies increase prices and de-
659. NPF-Menulog raises its payrate for
crease quantity over competitive markets.
drivers. What curve is impacted in the
pizza shop market and how? B. Deadweight losses indicate that mo-
nopolies are inefficient.
A. Demand Left
C. Economies of scale can exist so that
B. Demand Right
each unit is produced more efficiently (i.e.,
C. Supply Left at alower per-unit cost) in larger firms.
D. Supply Right D. none of above
660. Which of the following is not a character- 665. Which of the following is NOT a barrier
istic of perfect competition? to entry?
A. Easy to Enter the Market A. Start up cost
B. Many Buyers and Sellers B. technology
C. Some Control Over Price C. internet
D. Products are the same D. education/training

666. What graph usually present values in de- C. Oligopoly

grees? D. Monopoly

A. bar chart
671. What are the barriers to entry in an
B. histogram oligopoly market structure?
C. flow chart A. The barriers to entry in an oligopoly
D. pie graph market structure include high start-up
costs, economies of scale, product differ-
667. TRUE or FALSE-The Franchisee can bene- entiation, and control over essential re-
fit from using the brand name of the Fran- sources.
chise, as well as advertising and market-
ing B. Limited competition and low
economies of scale
A. TRUE
C. No product differentiation and lack of
B. FALSE control over essential resources
668. What is the market structure character- D. Low start-up costs and easy market en-
ized by a single firm dominating the mar- try
ket?
672. Exists when many sellers offer similar,
A. Perfect competition but not standardized products
B. Monopoly A. Monopoly
C. Oligopoly B. Oligopoly
D. Monopolistic competition C. Monopolistic Competition
669. A structure with a small number of busi- D. Perfect Competition
nesses selling the same or similar products
673. Colin’s KTV is one of the many entertain-
A. Monopoly ment businesses in the country and he has
B. Oligopoly a downward sloping demand curve. Which
market structure is this?
B. Oligopoly
670. UPS, the Post Office, and FEDEx are the
three dominant companies in the shipping
industry. D. Monopoly
674. Where is this beach?
A. Pure Perfect Competition

B. Monopolistic Competition A. Cancun

B. Vallarta Port 678. Yaz produces nails at a cost of $200 per

C. Hawaii ton. If he sells nails for $350 per ton, his
producer surplus per ton is
D. Brazil
A. $200
675. The most recent antitrust legislation tried
B. $350
to stop
A. Trusts C. $150
D. $550
NARAYAN CHANGDER
B. Mergers
C. Price discrimination 679. Which of the following characteristics
D. Predatory Pricing does not match the characteristics of a mo-
nopolistic competition market?
676. Which of the following statements cor-
A. The number of producers is large and
rectly identifies a difference between per-
the size of the companies is small
fect competition and monopolistic competi-
tion? B. Determination of maximum profit at
A. In perfect competition there are no the output level where MC = MR
barriers to entry, but there are strong bar- C. Companies need advertising media
riers in monopolistic competition. D. Companies are faced with a horizontal
B. In perfect competition there are many demand curve
firms, but in monopolistic competition E. The company as a price maker.
there are only a few firms.
C. In perfect competition the firms all sell 680. What is not a characteristic of monopolis-
products that are exactly the same, but in tic competition?
monopolistic competition each firm sells a A. many sellers
slightly differentiated product.
B. easy market entry
D. In perfect competition there are few
consumers, but in monopolistic competi- C. similar products sold within the same
tion there are many consumers. price range
D. products are identical
677. What does this curve represent?
681. Their is only one supplier in this market
structure.
A. demand
B. supply
C. equilibrium A. monopoly
D. shortage B. monopolistic competition

C. oligopoly B. Perfectly inelastic

D. pure / perfect competition C. Downward sloping

682. Conditions that make it difficult and D. Horizontal
costly for an organization to enter a par-
ticular market or industry are referred to 687. Collusion among firms in an industry is
as most likely under conditions of
B. oligopoly
D. monopoly
A. Barriers to Entry 688. Average costs of production fall as output

B. Antitrust laws of the good or service increases.
C. Collusion A. economies of scale

D. Cartels B. cartel
683. The shareholders may receive a part of C. collusion

the company’s annual profit, if there is D. barriers to entry
one, in the form of a dividend.
A. True 689. A market structure in which only one
seller sells a product for which there are
B. False
no close substitutes
684. SSEMI3 b Which market structure, other A. Incentives
than a monopoly, would have the highest
barrier to entry? B. Monopoly
A. Oligopoly C. Interest Rates
B. Pure Competition D. none of above
690. According to the payoff matrix, what is
D. none of above YELLOW’S dominant strategy?
685. A firm with market power engages in
price discrimination to:
A. earn a higher profit
B. increase consumer surplus
C. decrease deadweight loss
D. make its demand more elastic
686. What is the demand curve faced by a firm

in monopolistic competition? A. high
A. Perfectly elastic B. low

691. Google controls 67% of the web search 695. What is a characteristic of a monopolistic
market. The company has grown and competitive market?
branched off into email, online maps, GPS
A. Products are identical
tracking systems, online data storage and
mobile phones. There are competitors like B. Entry into the industry is easy
Microsoft and Yahoo, but they own just
C. Producers have complete control over
18% and 11% of the market, respec-
price
tively. Which market structure(s) best fit
Google? (There are two possible answers,
NARAYAN CHANGDER
D. There is only one producer
pick both)
A. Perfect competition 696. If a major car company such as Ford low-
ers their prices, what are other car compa-
B. Monopolistic competition
nies likely to do?
C. Oligopoly
A. Raise their prices
D. Monopoly
B. Go out of business
692. Why must stockholders pay taxes on div-
idends? C. Maintain their current prices
A. Dividends always get charged capital D. Lower their prices
gains tax
B. State taxes are mandatory 697. This single farmer is experiencing
C. Profit from dividends is a form of in-

come and stockholders must pay income
tax on profits
D. Stock is a share representing owned
portion of a corporation
693. What is the relationship between to-
tal revenue and marginal revenue in a
monopoly market?
A. They are always equal A. economic loss.
B. They are always positive B. economic profit.
C. They are always negative C. break-even.
D. They can be positive or negative D. normal profit.
694. Monopolistic competition is and a E. long run equilibrium.
good example would be
A. when many firms compete with differ- 698. Which business organization type is diffi-
entiated products, gasoline cult to establish?
B. when many firms compete with differ- A. Corporation
entiated products, toothpaste
C. when many firms compete with unique
products, electricity C. Partnership
D. none of above D. Booster Club

699. Which type of market structures has 703. A group of corporations run by a single
many producers (companies) and sell simi- board of directors
lar but different products from each other?

A. trust
These companies do not have control over
the price and there are low barriers to en- B. corpoation
try. C. company
A. perfect competition D. conglomerate
B. monopolistic competition 704. What kind of products. are sold in a per-
C. oligopoly fectly competitive market?
A. products are similar but not identical
D. monopoly
B. products are identical
700. What is the main characteristic of a
monopoly market structure? 705. An economic system in which people are
free to start their own businesses or to
A. The main characteristic of a monopoly do whatever work they want. Also called
market structure is that there is one seller capitalism or free market system
or producer in the market, with no per-
A. Bank Account
ceived close substitutes for the product or
service. B. Free Enterprise System
B. The main characteristic of a monopoly C. Trade Agreement
market structure is that the market is D. none of above
shared by some industries
706. This is an unsavory practice that big busi-
C. The main characteristic of a monopoly nesses can take part in which results in
market structure is that there are many higher costs for consumers.
sellers in the market
A. price fixing
D. The main characteristic of a monopoly
B. collision
market structure is that the products have
many close substitutes C. law of demand
D. economies of scale
701. Which market structure includes McDon-
alds and Hungry Jacks? 707. The amount of something available to
consumers is
A. Supply
B. Demand
C. Oligopoly
C. Surplus
D. Monopoly
D. Shortage
702. Which is NOT a characteristic of perfect 708. A monopoly created by economies of
competition? scale is known as a
A. Numerous buyers and sellers A. Monopoly with a patent
B. Standardized product B. Non-regulated monopoly
C. Differentiated product C. Natural monopoly
D. Independent buyers and sellers D. Monopoly without barriers to entry

709. If Farmer John expresses a desire to sell A. oligopoly

his corn at a local farmer’s market, he B. monopolistic competition
must be aware that the product is stan-
dardizedand that he will have no control C. monopoly
over the market price. The market struc- D. none of above
ture he is MOST likely participating in is
714. Which market structure has very high
A. pure oligopoly. product differentiation levels?
B. perfect competition.
NARAYAN CHANGDER
C. differentiated oligopoly. B. Monopolistic Competition
D. monopolistic competition. C. Oligopoly
710. For a competitive market, the supply D. Monopoly
curve will be closely related to
715. The cost added by producing one addi-
A. Preferences of consumers who buy the tional product or service.
company’s products
A. Marginal cost
B. Income tax rates imposed by the gov-
ernment B. Marginal revenue
C. The company’s production costs C. Relative cost
D. The interest rate offered for govern- D. Relative revenue
ment bonds 716. Weakness in the PERFECT COMPETITION
E. Taxes imposed by the government industry
711. These are disadvantages of what type of A. low investment

business organization? Unlimited liabilty, B. homogenous products
burden of responsibility on owner, and lim- C. lack of innovation
ited life
D. production efficiency
A. Sole Proprietorship
B. partnership 717. Imagine Benjamin, Ethan, and Nora are
playing a game of ‘Market Masters’. They
C. cooperation are trying to identify the type of market
D. limited liability company where there are many sellers offering dif-
ferentiated products. Can you help them
712. Low barriers to entry, but differenti- out?
ated products give businesses some con-
trol over prices. A. monopolistic competition
A. perfect competition B. monopoly
B. monopolistic competition C. oligopoly
C. oligopoly D. perfect competition
D. monopoly 718. Which condition is NOT required for per-

fect competition?
713. An industry with a large number of firms,
differentiated products, and free entry and A. Many buyers and sellers
exit is called B. Identical products

C. Informed market A. Nonprice competition

D. High barriers of entry B. price competition

719. All of the following may lead to market C. differentiation
failure EXCEPT
D. NONE of these
A. Insufficient information.
B. Prices do not reflect cost of produc- 723. reveals that equilibrium might not be
tion. the best solution for the parties involved.
C. Inadequate competition.
D. Buyers and sellers acting indepen-
dently
720. What is a collusive oligopoly?
A. Firms produce homogeneous products
B. Firms that act together to determine
price or output
C. Firms that compete with each other in A. Social optimization
determining output B. Price discrimination
D. Firms that cheat to maximise profits
C. Game theory
721. What is one kind of monopoly that the
U.S. government generally permits? D. Excess capacity
A. the electric company

724. The least complicated form of business or-
B. professional sports leagues ganization is a
C. Computer companies
D. Standard Oil
722. When companies will compete through
ways other than lower prices such as
physical Characteristics-offering a differ-
ent color, size, shape, texture, or taste,
better location-where they know they
have less competition, differing service
levels, and advertising, image, or status.
B. Oligopoly
C. Corporation
D. Partnership

725. Which of the following is an example of particular product. What is this market
nonprice competition? structure called?
A. American Eagle raises the price of all A. Monopolistic Competition
of their jeans. B. Oligopoly
B. Burger King adds items to their dollar C. Monopoly
menu.
D. Pure Competition
C. Wal-Mart has a sale on sugar.
NARAYAN CHANGDER
D. Nike designs a purple pair of Jordans. 730. What type of a monopoly the govern-
ment owns and operates?
726. Exists when the business controls a man- A. Natural Monopoly
ufacturing method or an invention pro-
tected by a patent B. Technological Monopoly
A. Natural monopoly C. Geographic Monopoly
B. Government monopoly D. Government Monopoly
C. Technological monopoly 731. a benefit someone receives who was not

involved in the activity that generated the
benefit.
727. The Government seeks to encourage A. neutral externalities
Externalities.
B. positive externalities
A. Negative
C. primary externalities
B. Neutral
D. negative externalities
C. Positive
732. In the 1990s, AT&T controlled 80% of
D. none of above the phone industry and was the ONLY
728. Definition:Market power provider of long distance phone service.
This is an example of
A. Important features of a market, in-
A. A monopoly
cluding the number of buyers and sellers,
product uniformity across sellers, ease of B. Monopolistic Competition
entering the market, and forms of compe- C. Perfect Competition
tition
D. Oligopoly
B. The ability of a firm to raise its price
without losing all sales to rivals 733. When the spread between 10-year US
C. Restrictions on the entry of new firms Treasury yields and the federal fundsrate
into an industry narrows and at the same time the prime
rate stays unchanged, this mix ofindica-
D. The sole supplier of a product with no tors most likely forecasts future economic:
close substitutes
A. growth.
729. Priya is studying different market struc- B. decline.
tures in her economics class. She came
across a scenario where a single company, C. stability.
say ‘X’, controls the entire market for a D. none of above

734. A market structure in which one firm has 739. Promotes wise decision making when us-
a monopoly because of its location is a ing resources

A. natural monopoly. A. stability
B. geographic monopoly. B. freedom freedom
C. technological monopoly. C. efficiency
D. government monopoly. D. security
735. What are some examples of corpora-
740. A merger of corporations involved in dif-
tions?
ferent steps of manufacturing is known as
A. Amazon Corporation ?
B. Google Inc. A. horizontal merger
C. Facebook Company B. conglomerate
D. Apple Inc., Microsoft Corporation, C. vertical merger
Coca-Cola Company tagsSSEMI3
D. none of above
736. A market structure with a few large firms
741. All of the following are examples of pub-
A. monopoly
lic disclosure EXCEPT
B. oligopoly
A. ingredient labels on food products
C. monopolistic comp
B. yearly reports of how much money has
D. perfect comp been earned and spent
737. Public goods are C. listing of the people who are on the
board of directors of a company
A. nonexcludable and nonrival in con-
sumption. D. all of the above are examples of public
B. excludable and rival in consumption. disclosure
C. nonexcludable and rival in consump- 742. Label the continuum of market structures.
tion. abcd
D. excludable and nonrival in consump- A. a Oligopoly
tion
B. b Monopoly
738. Gordon lists his old Lionel electric trains C. c Pure Competition
on eBay and sets a minimum acceptable
price at $75. He received three bids af- D. d Monopolistic Competition
ter five days on eBay:$25, $50, and $75.
He accepts the latter. His producer surplus 743. Which of the following is regarded as the
is: most influential factor of demand?
A. $0 A. price of the commodity

B. $25 B. price of other commodities
C. $50 C. price of related commodities
D. $75 D. price of the market

744. When the supply of a product or service

goes up and the demand stays the same
the Price will typically do what?
A. Commodity
NARAYAN CHANGDER
B. Differentiation
A. rise C. Franchise
D. Patent
B. fall
C. stay the same 748. What is one reason that local law en-
forcement is considered a public good?
D. Consumer
A. Everyone in the community benefits
from it.
745. Which statement is NOT TRUE about
monopoly? B. Nobody in the community has to pay
for it.
A. It is difficult for other sellers to com-
pete in the market. C. Private firms make a profit from pro-
ducing it.
B. Only one firm controls the supply and D. Individual citizens pay directly for it.
distribution of the product.
C. It is considered an imperfect competi- 749. Leticia graduated from college with an en-
tion gineering degree. She has had several job
offersbut is still searching for the right one.
D. The firm doesn’t have any control over What category of unemployment best de-
the price of the product. scribesLeticia’s situation?
A. Frictional
746. How does competition affect producers in
a market economy? B. Structural
C. Cyclical
A. They generally agree to share re-
sources equally. D. Permanent
B. They improve the quality of their goods 750. Which market is most likely to be subject
to attract buyers. to collusion?
C. They look to the government to assign A. Perfect competition
resources. B. Monopolistic competition
D. They ration their goods equally among C. Oligopoly
consumers. D. Monopoly
747. What is it when you make a product un- 751. This firm will charge a price of and
like any other product? make a per unit of

D. oligopoly

756. There are very high barriers these two
structures
A. monopoly
C. oligopoly
A. 7; loss; 1.5. D. pure / perfect competition
B. 7; normal profit; 0.
757. If competition is inconvenient and imprac-
C. 7; profit; 1.5.
tical, what type of market structure tends
D. 5.5:loss; 1.5. to develop?
E. 5.5; profit; 1.5. A. Geographic Monopoly
752. When competitors cut their prices really B. Government Monopoly
low to win business C. Technological Monopoly
A. Price War D. Natural Monopoly
B. Collusion
758. Which market structure is considered a
C. Cartel
“price taker” because they have to take
D. Price Discrimination the price set by supply and demand?
753. How many straight edges does a cube A. Perfect Competition
have? B. Monopolistic Competition
A. 8 C. Oligopoly
B. 4 D. Monopoly
C. 16
759. A market dominated by a few large, prof-
D. 12
itable firms
by a single seller with complete control
over the market?
A. oligopoly
B. monopsons
D. monopoly
A. Monopoly
755. Which of the following market types
have only a few competing firms B. Natural Monopoly
A. monopoly C. Government Monopoly
B. perfect competition D. Oligopoly

760. A student graduates from college and C. a few firms that sell most of the prod-
starts a profitable new business. She cre- ucts
ates jobs for three workers. Those jobs D. consumers have no idea what the price
are is
A. a form of nonprice competition. E. the companies advertise, A LOT!
B. a negative externality.
766. All are types of monopolies except
C. a positive externality of her education.
A. Natural
NARAYAN CHANGDER
D. a sign of market efficiency.
B. Technology
761. Markets with very few barriers to entry
are usually C. geographic
A. Monopolies D. National
B. Oligopolies 767. Imperfect Competition

C. Competitive Markets A. Market structure with perfect compe-
D. none of above tition and no market power.
B. Market structure with no sellers and
762. Type of Monopoly is based on businesses
only one buyer.
creating new products
C. Imperfect competition lacks one or
A. Natural
more characteristic of pure competition.
B. Government
D. Market structure with only one seller
C. Technological and multiple buyers.
D. Geographic
768. A sole proprietorship is described as
763. In this situation a small group of business A. a business owned by 2 or more people
controls an industry.
B. a business owned by one person
A. Megalopoly
C. a business owned by a corporation
B. Triopoly
D. None of the above
C. Oligopoly
D. Monopoly 769. What is the difference between a perfect
competition and monopolistic competition?
764. Which of the following has a natural
A. It is easy to enter a Perfect competi-
monopoly in Aklan, for example?
tion, but difficult to enter a Monopolistic
A. Sally Sari S training competition
B. Globe B. There are many sellers in a monopolis-
C. Akelco tic competition and few sellers in a per-
D. Jollibee fect competition
C. A monopolistic competition is a perfect
765. Which of the following are characteristics competition except it has product differen-
of a perfectly competitive market? tiation
A. identical products D. A perfect competition operates at
B. identical prices Profit-maximizing price and quantity

where MR=MC, a Monopolistic compe- 775. The unit elasticity point for this model
tition operates at normal profit in the long would occur at quantity
run

770. Monopolistic competition is different
from perfect competition because in mo-
nopolistic competition
A. Products are differentiated
B. There are many buyers and sellers
C. It is easy to enter the market
A. 1, 000.
D. Products are the same
B. 2, 000.
771. A competitive market where a few com-
panies dominate the market best describes C. 2, 150.
which market structure
D. approximately 2, 500.
A. Oligopoly
B. Monopolistic Competition 776. The combination of two or more firms in-
C. Perfect Competition volved in different stages of producing the
same good or service is known as
D. Monopoly
772. Which of the following is NOT an exam-
ple of non-price competition?
A. Location
B. Brand name/image/status
C. Service level
D. All of the above are examples of non- A. Multinationals
price competition
B. Vertical Mergers
773. It is a group of suppliers whose purpose
is to maintain prices at a high level, and to C. Conglomerate
restrict competition in the market. D. Horizontal Mergers
A. oligopoly
B. oligopsones 777. An analyst gathered the following mar-
C. cartel ket share data for an industry comprised
of five companies:The industry’s three-
D. collusion firm Herfindahl-Hirschmann Index is clos-
774. How can you move from a shortage to est to:
equilibrium? A. 0.185.
A. Raise Prices
B. 0.225.
B. Lower Prices
C. Keep prices the same C. 0.235.
D. All of the above D. none of above

778. Clayton Anti-trust Act 783. Product differentiation is

A. The Clayton Anti-trust Act is a state A. offering identical products to con-
law in the United States that was enacted sumers.
in 1914.
B. The Clayton Anti-trust Act is an inter- B. offering different products to con-
national law that was enacted in 1914. sumers.
C. The Clayton Anti-trust Act is a federal C. offering similar products to con-

law in the United States that was enacted sumers.
NARAYAN CHANGDER
in 1914.
D. none of above
D. The Clayton Anti-trust Act is a local law
in the United States that was enacted in
784. Generally, each successive unit of a good
1914.
consumed will cause marginal utility to
779. A economy’s government makes all
of the major economic decisions.
A. Increase at an increasing rate
A. traditional
B. Increase at a decreasing rate
B. mixed
C. market C. Decrease (or “diminish”)
D. command D. Who knows? Life’s a gamble!
780. In which market structure do firms use
“strategic pricing” to find the Nash Equi- 785. which item being sold would be consid-
librium? ered monopolistic competition?
A. monopoly A. jeans
B. oligopoly B. oranges
C. psch
D. electricity
781. Which type of market structures has
many many producers(companies) that sell
identical products and has no control over 786. Monopolistic competition
price? A. market structure characterized by a
A. perfect competition single producer in a market
B. monopolistic competition B. market structure in which a firm has
C. oligopoly a monopoly because of its location or the
D. monopoly small size of the market
782. Number of sellers in perfect competition C. market structure having all conditions
of pure competition except for identical
A. A few products
B. One
D. market structure in which the average
C. Many costs of production are lowest when all
D. none of above output is produced by a single firm

787. All of the following are characteristics of 791. The worldwide market structure for cars
monopolistic competition except most resembles a:

A. There are many buyers and many sell- A. monopolistic competition
ers.
B. oligopoly
B. The products sold are similar but dif-
ferentiated. C. perfect competition
C. A market leader may emerge from D. monopoly

among the many suppliers.
792. Which of the market structures will have
D. There are many barriers to entry and possibility to sustain or make ‘supernor-
exit. mal profit’ in the long run?
788. NPF-The gov’t cuts tariffs on at-home A. Perfect Competition
espresso machines. What curve is im-
B. Oligopoly
pacted in the takeaway coffee market and
how? C. Monopolistic Competition
A. Demand Left D. Monopoly
B. Demand Right
793. Government regulations exist to
C. Supply Left
A. Increase economic freedom
D. Supply Right
B. Protect consumers from negative ex-
789. If a corporation’s stock is not available ternalities
for sale to the general public and is held by
only a few people, such as family members C. Punish people who intervene in the
or employees, the corporation and stock is free market
said to be D. Provide incentives to privatize
794. Any factor that makes it difficult for a

new firm to enter a market such as high
start-up costs or a high degree of technol-
ogy needed.
A. Barrier to Entry
A. Closely Held
B. Start-Up Costs
B. Blue Chip
C. Price War
C. Preferred Stock
D. Collusion
D. Publicly Traded
795. In which market is a firm’s profit always
790. Government regulation may negatively
zero at long-run equilibrium?
affect businesses in the following ways by
A. Increasing input costs A. monopoly
B. Increasing profits B. oligopoly

C. Lowering consumer prices C. monopolistic competition
D. All of the above D. perfect competition

796. A government license that gives the in- C. Fast food

ventor of a new product the exclusive right D. Dart trains
to produce and sell it.
A. market power 801. When there is lots of competition in a
market because the barriers to entry are
B. economies of scale
low and there are many substitutes that
C. patent exist, this is called?
D. license A. Monopoly
NARAYAN CHANGDER
797. If a monopolist is producing a level of out- B. Oligopoly
put where MR exceeds MC, then it should C. Monopolistic Competition
A. Raise its price. D. Perfect Competition
B. Increase its output.
802. Public disclosure supports competition by
C. Lower its output.
A. Providing buys and sellers with infor-
D. Shift its marginal cost curve upward. mation
798. What is the equilibrium quantity in this B. revealing competitive trade secrets
graph? C. converting private businesses into
government agencies
D. concentrating information in the hands
of the government
803. A monopoly created by the administra-

tion.
A. government monopoly
B. market power
A. $1.50
C. monopoly
B. $1.00
D. natural monopoly
C. 600
D. 800 804. valuable product
A. commodity
799. Choose the example that goes best with
monopolistic competition. B. salt
A. fast food C. fiat
B. soda pop D. gold
C. cars 805. The fact that you can buy shares in AT&T
D. gas (for your house) and Target makes them
800. An example of monopolistic competition
is B. a cartel
A. Oncor C. a partnership
B. the water company D. a corporation

806. What is perfect competition? C. be readily sellable via vast markets

A. a market structure characterized by a such as the internet or other markets
which advertise locally, nationally, and

large number of well-informed indepen-
dent buyers and sellers who exchange worldwide.
identical products D. identify which group a buyer falls (high
willingness to pay or low willingness to
B. competition is the market structure
pay)
that has all the conditions expect for iden-
tical products 810. Which Market Structure has one seller
C. a market structure in which a few very and owns the market?
large sellers dominate the industry A. Pure Competition
D. a market structure with only one seller B. Monopolistic Competition
of a particular product C. Oligopoly
807. The purpose of both deregulation and an- D. Monopoly
titrust laws is to 811. A market that only features one seller of
A. promote competition a product is
B. promote inefficient commerce A. a monopoly
C. government control B. perfectly competative
C. an oligopoly
D. prevent monopolies
D. in monopolistic competition.
808. If a firm enjoys economies of scale,
812. Which of these is NOT one of the condi-
A. its profits will increase as production tions of PURE COMPETITION
increases
A. Easy market entry and exit
B. its profits will decrease as production
B. Many buyers and sellers
increases
C. informed sellers and buyers
C. it is in perfect competition
D. differentiated products
D. costs will rise as production goes up
813. The American industry that comes closest
809. All of the following are things have to be to its agriculture before 1930
able to do in order to price discriminate ex- A. Perfect Competition
cept
C. Oligopoly
D. Pure Monopoly
814. What type of market structure has no
barriers to entry, and products are iden-
tical?
A. monopoly
A. divide buyers into groups according to B. oligopoly
their willingness to pay. C. perfect Competition
B. prevent resale of the good or service. D. monopolistic competition

815. The marginal cost curve typically does C. it stays the same
which of the following? D. it is not effected
819. Can price control by the government re-
duce the exploitation of monopolists?
A. yes
B. no
NARAYAN CHANGDER
820. Oligopoly is characterized by
A. Many firms.Easy entry.Example-food
A. Increases at a fixed rate. industry.
B. Decreases and eventually increases. B. Few firms.Impeded entry.Example-oil
C. Decreases at a decreasing rate. companies, car manufacturers.
D. Increases and eventually decreases. 821. Which first electrical item did Thomas Edi-
son invent?
816. In the long run we would expect firms to
the market and the market price to A. Telephone
B. Television
C. Lightbulb
D. Toaster
822. Why are monopolies bad?
A. Control Pricing
B. Controls Who makes it
A. enterprise
C. Both
B. enter; fall
D. Neither
C. leave; rise
823. The causes of market failure include:
D. leave; fall
A. increased competition, inadequate
E. profit from the market; remain the
competition, and resource immobility
same.
B. inadequate competition, inadequate
817. What type of economic system does the information, and externalities
United States use?
C. inadequate competition, inadequate
A. Traditional Market information, and resource mobility
B. Free Enterprise D. increased competition, inadequate in-
C. Command Market formation, and externalities
D. Socialist Enterprise 824. What are the characteristics of perfect
competition?
818. For the law of demand, as price rises,
what happens to quantity demanded? A. Small number of buyers and sellers,
homogeneous products, perfect informa-
A. it goes up tion, restricted entry and exit, no control
B. it goes down over prices.

B. Large number of buyers and sellers, 829. The difference between a market and an
differentiated products, imperfect infor- industry is that
mation, free entry and exit, control over

A. industries consist of markets produc-
prices.
ing the same good while markets consist
C. Large number of buyers and sellers, of firms producing substitute goods
homogeneous products, perfect informa-
tion, free entry and exit, no control over B. industries consist of firms producing
prices. the same good while markets consist of
industries producing substitute goods
D. Small number of buyers and sellers,
differentiated products, imperfect infor- C. industries are collections of markets
mation, restricted entry and exit, control while markets are collections of firms
over prices. D. firms make up a market while markets
make up an industry
825. Which market structure best describes
the Tucson casino market? E. industries are substitutes for markets,
A. oligopoly but markets are not substitutes for indus-
try
C. perfect competition 830. What term is defined as “the nature and
degree of competition among firms in the
same industry?
826. Which of the following is the best defini- A. market structure
tion of the word “marginal?”
B. market failure
A. Additional
B. Abstract C. monopolistic competition
C. Econometric D. Let it happen

D. Complicated 831. What are barriers to entry?
827. Which type of market structures has few A. Factors that make it difficult for new
producers(companies) such as 2 or 3 and firms to enter a market.
they have complete control over the price?
Hint:think of the soda market B. Fees to get into college
A. perfect competition C. Big walls that prevent people from get-

ting into a mansion
D. Having to take a test to graduate high
C. oligopoly
school
D. monopoly
832. An action by one seller in this market will
828. Which of the following industries is NOT
always affect all the others.
an example of an oligopoly?
A. bicycle repair A. Perfect Competition
B. cola B. Pure Monopoly

C. air travel C. Monopolistic Competition
D. breakfast cereals D. Oligopoly

833. Sophia, Jackson, and Lily are playing a C. Oligopoly

game about market structures. They need
D. Monopoly
to identify the market structure with only
one seller. Can you help them?
838. The term liability means which of the fol-
A. oligopoly lowing?
B. monopsons
A. responsibility
C. monopoly
B. probability
NARAYAN CHANGDER
C. propensity
834. Barriers to entry are
D. capability
A. market structures in which producers
have some control over the price of their
products. 839. Scarlett, Evelyn, and Elijah are running a
lemonade stand in a perfectly competitive
B. obstacles that can restrict access to a market. What is the main assumption of
market and limit competition their market situation?
C. producers who must accept the mar-
A. The lemonade they produce is unique
ket price for their product.
and cannot be replicated by others
D. the costs of shopping around for the
best product at the best price. B. They can prevent new lemonade
stands from popping up in their neighbor-
835. Lily, Grace, and Emma are discussing their hood
favorite topic:economics! They’re trying
C. There are a large number of lemonade
to remember the term that refers to the
buyers and sellers in their neighborhood
ability of a firm to influence market condi-
tions. Can you help them out? D. They have full knowledge of profits and
A. Market control prices of all other lemonade stands
B. Market dominance
840. Josie owns stock in Crosby Enterprises.
C. Market influence What is a disadvantage Josie faces?
D. Market power A. unlimited liability
836. Which market structure is characterized B. bothered by many company decisions
by a large number of firms, homogeneous
products, and free entry and exit? C. double taxation
A. perfect competition D. losing her multi-million dollar estate
841. Which type of market structure has the
C. oligopoly
lowest level of market concentration?
D. monopoly
A. monopoly
837. What market form are sellers free to en-
B. oligopoly
ter into, conduct, or get out of business?
A. Monopolistic Competition C. monopolistic competition
B. Perfect (Pure) Competition D. perfect competition

842. Which of the following is a disadvantage 846. Which of the following is the best exam-
of a corporation? ple of a perfectly competitive market?

A. soft drinks
B. diamonds
C. farming
D. none of above
847. To find profit maximization, you must

A. it is easy to raise financial capital us- find the quantity where marginal costs
ing stocks, bonds, or loans. equal
B. thedouble taxationof corporate profits. A. average fixed costs
Profits are taxed the first time when the
B. variable costs
corporation pays income taxes. The prof-
its are taxed a second time when share- C. market structure
holders pay taxes on their dividends.
D. Marginal revenue
C. it is easy to get a charter to start a cor-
poration. 848. Who is a consumer?
D. Owners and shareholders have total A. buyer of a commodity
control over what happens with the busi-
ness. B. customer of a commodity
843. If not regulated by the government, C. user of a commodity

which market structure has total price- D. maker of a commodity
setting power?
A. monopoly 849. Globalization leads to all of the following
except
B. oligopoly
C. monopolistic competition A. Less manufacturing jobs
D. perfect competition B. Lower wages for low skilled workers
844. a market with many buyers and sellers, C. Lower wages for high skilled workers
identical products, and free entry and exit D. A greater need to know about other
A. monopoly cultures and languages
B. oligopoly
850. If ABM firm sells its product in a market,
C. monopolistic comp with many sellers and buyers ofhomoge-
D. perfect comp neous product, and unlimited resource mo-
bility, the structures is a/an ?
845. Perfect competition is characterized by
A. monopolist
A. large number of buyers and sellers
B. diverse products B. oligopolist
C. sellers acting together to set prices C. perfect competitor

D. uninformed buyers and sellers D. monopolistic competitor

851. Which of the following is a disadvantage 854. The desire or willingness a consumer has
of a Sole Proprietorship? to purchase a good or a service is called?
A. Difficult to raise money
B. Difficult to start
C. Less flexible
D. Double Taxation
NARAYAN CHANGDER
852. What is the difference between perfect
A. shortage
B. supply
C. price
D. demand
855. Susan, Phil, Robert, and Martina are all

lawyers. After several years of working
for big firms, they decide to pull their re-
sources and start their own law practice
together. The four of them will make all
A. PC has a large # of small firms while
their business decisions together and will
MC does not.
share all of the profits and financial risk.
B. PC has barriers to entry while MC does Their new law firm is a
not. A. partnership
C. In MC, firms produce identical goods, B. corporation
while in PC, firms produce slightly differ-
ent goods. C. sole proprietorship
D. monopoly
D. In PC, firms produce identical goods,
while in MC, firms produce slightly differ- 856. How does the profit-maximizing behav-
ent goods. ior of a monopolistic competitor compare
E. PC has no barriers to entry while MC to that of perfect competitors, oligopolies,
does. and monopolies?
853. What is it when you make a product un-

like any other product?
A. Commodity
B. Differentiation
C. Franchise
D. Patent

A. They all try to find the level of output 861. Point B represents
where their marginal cost is equal to their
marginal revenue.

B. The monopolistic competitor is similar
to monopoly but not to pure competition.
C. The monopolistic competitor is similar
to pure competition but not to oligopoly.
D. The monopolistic competitor is similar
to monopoly but not to oligopoly. A. Product Market
857. The airline industry is a good example B. Factor Market
A. Perfect Competition C. Individuals
B. Monopolistic Competition D. Businesses
C. Oligopoly 862. A barrier to entry is
D. Pure Monopoly
A. anything that prevents a new firm from
858. It is the most ideal market structure. joining a market.
A. perfect competition B. an open door.
B. monopolistic competition C. illegal in most markets.
C. oligopoly D. none of above
D. monopoly 863. A single seller in a market
859. a way to attract customers through style, A. monopoly
service, or location, but not a lower price B. oligopoly
A. non-price competition C. monopolistic competition
B. price competition D. perfect competition
C. competition
864. Market structure with one seller provid-
D. advertising ing a unique product with no close subsi-
860. Parrott, Ga, is a very small town that tutes
has only one gas station. A. Oligopoly
D. Monopoly
865. A merger is
A. Two business agreeing to becoming
one new business
B. One business buying shares in another
B. Monopolistic Competition business
C. Oligopoly C. One business taking over control of an-
D. Monopoly other business

D. Two businesses co operating with each 870. An industry or market that is dominated
other. by a few firms is
A. a Monopoly
866. A mine worker is an example of which
factor of production? B. an Oligopoly
A. Land C. a Competitive market
B. Labor D. none of above
C. Capital
NARAYAN CHANGDER
871. When P>ATC, this also means that total
D. Entrepreneurship revenue is than total cost.
A. less
867. What market structure is characterized
by a few large firms dominating the mar- B. more
ket and interdependence among firms? C. equal
A. Monopoly D. none of above
B. Perfect competition 872. In a partnership, the owners
C. Monopsons A. have limited liability.
D. Oligopoly B. have unlimited liability.
868. One important advantage of forming a C. always split the profits 50/50, no mat-
partnership is that this form of business ter what.
organization gives each owner sole control D. cannot be separated or bought out.
over the business.
873. When two companies that produce the
A. True same kind of product merge, this is called
B. False a
A. Horizontal merger
869. The shaded area in the graph shows:
B. Vertical merger
C. conglomeration
D. Multinational merger
874. Which of the following market structures

would be considered the least competi-
tive?
A. the increase in profit when output is re-
duced from 8 to 7 units of output.
C. oligopoly
B. the profit that could be made if output
increases from 7 to 8 units of output. D. monopoly
C. the deadweight loss associated with 875. Oligopolies and monopolies are similar
the power of the price taking firm. because
D. the amount of profit when 8 units of A. They both have many buyers and sell-
output are produced. ers.

B. They both are the only sellers of their B. Monopolistic Competition

product. C. Oligopoly

C. They both have identical products.
D. They both have high barriers to entry.
881. a market structure in which many compa-
876. If the price of a resource used to produce nies sell products that are similar but not
a good increases, this will the supply identical
of said good.
A. Increase
B. oligopoly competition
B. Decrease
C. monopoly market
C. Neutralize
D. Remove
882. Market failures occur when
877. an exclusive right to manufacture, use or
sell any new and useful inventionfor a spe- A. the accumulation of wealth in the free
cific period. market is shared between a large group
of people
A. patent
B. a command economy increases pro-
B. trademark
duction
C. copyright
C. the economy has a strong GDP and low
D. monopoly interest rates
878. The book discusses water service as be- D. the distribution of goods and services
ing a monopoly; it would be ineffective in the free market is not efficient and
otherwise. leads to loss of social wellbeing
A. natural 883. Head of the Soviet Communists after
B. self-evident 1924, and dictator of the Soviet Union
from 1928 to 1953. He led the Soviet
C. constitutional
Union withan iron fist, using Five-Year
D. unimportant Plans to increase industrial production and
terror to crush opposition
879. The lure of motivates entrepreneurs
to take risks and start businesses. A. Adam Smith
A. Income B. Joseph Stalin
B. Income C. Karl Marx
C. Sales D. none of above
D. Profits 884. What are the three types of business or-
ganizations?
880. You are traveling and run low on gas in an
out-of-the-way location. There is only one A. sole proprietorship, partnership, and
gas station for the next 30 miles. How corporation
would you define this market structure? B. government agency, trust, and associ-
A. Geographical Monopoly ation

C. franchise, joint venture, and limited C. PERFECT COMPETITION

partnership D. MONOPOLISTIC COMPETITION
D. limited liability company, cooperative,
and non-profit organization tagsSSEMI3 889. When there is an economic/supernormal
profit in the short run for PERFECT COM-
885. A market in which there are many buyers PETITION, most likely
but only one seller. A. new firms will enter the industry
A. Monopoly B. new firms will exit the industry
NARAYAN CHANGDER
B. pure competition C. nothing will happen
C. oligopoly D. I know something will happen, but
D. command market doesn’t know what exactly happen
886. This is the easiest market structure to en- 890. markets are classified by
ter because of low barriers to entry and A. competition
the number of producers.
B. imports
C. exports
D. advantages
891. In the long run we would expect firms to

the industry and the market price to
A. Monopoly
D. Oligopoly
A. leave; rise
887. Which market structure has the highest
concentration of sellers? B. leave; fall
A. Perfect Competition C. enterprise
B. Monopolistic Competition D. enter; fall
C. Oligopoly E. enter; remain the same.
D. Monopoly 892. In an oligopolistic market, how many pro-

ducers are there?
888. MARKET DOMINATED BY A FEW, LARGE
PROFITABLE FIRMS THAT COLLUDE TO FIX A. A few
PRICES B. A large number
A. OLIGOPOLY C. Only one
B. MONOPOLY D. None

893. This type of market structure uses 898. Partners who are only responsible up to
product differentiation and brand the extent of their investment
name/advertising is the most important.

A. limited partnership
A. perfect competition B. trading partnership
B. pure competition C. non-trading partnership
C. monopolistic competition D. special partnership
D. monopoly
899. What prevents firms from entering a
894. Market is monopoly?
A. place where buyers meet sellers A. Barriers
B. Bath / bazaar B. Technology
C. Is a situation where optimum cus- C. Price
tomers meet optimum sellers D. The government
D. online market
900. A firm experiences with expenses
895. Collusion is associated with which mar- that must be paid before goods can be pro-
ket structure? duced and sold.
A. Monopoly A. start-up costs
B. Oligopoly B. back up costs
C. Monopolistic Competition C. opening day costs
D. Perfect Competition D. overhead costs
901. True or False:Horizontal mergers benefit

896. How many sellers are in a monopoly?
consumers with increased competition and
A. 1 lower prices
B. 4 A. true
C. 3 B. false
D. A spy with
902. In the scooter market, a NPF moves the
897. A plant in a small town closes, leaving demand curve left. What happens to the
hundred of people unemployed. There are allocation of resources?
jobs available at the similar plant in an- A. Moves left
other state, but many of the unemployed B. Moves right
workers are unwilling to move or cannot
afford to move. An economist might use C. Increase
this as an example to: D. Decrease
A. describe what happens where there is
903. Which of the following is NOT an advan-
not enough competition
tage of organizing your business into a cor-
B. define resource immobility poration?
C. define a public good A. Limited Liability
D. explain an externality B. Easily Controlled

C. Benefits of Specialization
D. East of Raising Capital
904. Which of the following markets have the

highest barriers to entry?
NARAYAN CHANGDER
C. Oligopoly A. M;N
D. Monopoly B. M;Q
C. N:R
905. Few sellers offer similar products
D. N:Q
A. Price Takers
E. Q:R
B. Monopoly
909. Based on the information in the table,
C. Oligopoly
what gain did Benin make by specializing
D. Price Fixing in tractors?
906. Add 23 plus 34 plus 46

A. 346
B. 103
C. 102 A. 40 tractors
D. 93 B. 12 tractors
C. 28 tractors
907. The SOLID arrows on this circular flow di-
agram represents the flow of D. 15 tractors
910. In monopolistic competition, what type of

differentiation helps firms sell their prod-
ucts over others?
A. Price differentiation
C. Market differentiation
A. Productive Resources, Goods and Ser- D. Advertising differentiation tagsSSEMI3
vices
911. All of the following are characteristics of
B. Imports a perfectly competitive firm except for
C. Taxes A. Firms are price takers
D. Money B. There are many firms in the market
908. In an oligopoly, firms will produce be- C. Products are differentiated

tween quantities and D. Very low barriers to entry and exit

912. If you live outside the city of Tucson, 917. What is a price taker?
there are many firms who collect trash
A. a consumer who accepts different
and all have similar prices. Which market

prices from different firms.
structure is this?
A. perfect competition B. a perfectly competitive firm
B. oligopoly C. a firm that cannot influence the market

price.
C. monopoly
D. none of above
913. If the entire output of a market is pro- 918. If a person gets a patent on a product
duced by a single seller, the firm that product is in which market structure?
A. Is a monopoly. A. Perfect Competition
B. Faces perfectly inelastic demand. B. Monopolistic Competition
C. Can charge any price it wants and not C. Oligopoly
lose customers.
D. Monopoly
D. Is producing a new product.
914. Cartels are difficult to operate for which 919. This type of business is owned by two or
of the following reasons? more people and has unlimited liability.
A. They work only if members keep to A. Sole Proprietorship
their agreed output. B. Partnership
B. They are illegal worldwide.
C. Corporation
C. Firms in a cartel are likely to lose
money. D. Franchise
D. The products are perfectly competi- 920. Which market structure is characterized
tive. by a small number of large firms dominat-
ing the market?
915. Businesses, individuals, and the govern-
ment have a hand in our economy. A. Perfect Competition
A. Communism B. Monopolistic Competition
B. Free-Market C. Oligopoly
C. Socialism
D. Monopoly
D. Mixed-Economy
921. Each below is an example of an Oligopoly
916. This is the most difficult market structure
except
to enter based on the number of producers
and high barriers to entry A. Few Sellers
A. Monopoly B. Lots of freedom to enter or exit the
B. Monopolistic Competition market
C. Perfect Competition C. Many Buyers
D. Oligopoly D. More control of Prices

922. How many companies are there in a per- B. Oligopoly

fect competition? C. Monopolistic Competition
A. 1 D. Monopoly
B. 2-5
928. Market where competition is inconve-
C. Many nient and impractical. Efficiency is best
D. none of above achieved by a single seller.
A. Natural Monopoly
NARAYAN CHANGDER
923. What do patents and copyrights create?
A. Temporary monopolies B. Monopoly
B. Perfect competition C. Geographic Monopoly

C. Natural Monopolies D. Technical Monopoly
D. Differentiated competition 929. What is occurring when quantity de-
manded is greater than quantity supplied?
924. To maximize profit, firms in all market
structures produce the quantity of output A. Equilibrium and price is equal
at which B. Surplus and price is too low
A. total revenue equals total cost C. Shortage and price is too high
B. marginal revenue equals marginal D. Shortage and price is too low
cost
930. ATT, Verizon, Sprint, and T-Mobile as
C. average revenue equals average cost
firms in the wireless carrier industry are
D. total revenue equals marginal cost an example of a(n)
E. marginal revenue equals total cost
925. Choose the example that goes best with

a monopoly.
A. Cars
B. Electricity
C. Fast Food
D. Produce A. Monopoly
B. Oligopoly
926. This market structure is most beneficial
to consumers C. monopolistic competition
A. Monopoly D. perfect competition
B. Oligopoly 931. Which of the following is NOT an exam-
C. Monopolistic Competition ple of a franchise?
D. Perfect Competition A. Urgent care
927. What is an extreme case of market struc- B. McDonalds

ture? C. Wendy’s
A. Perfect competition D. 7-11 Stores

932. Robinson-Putman Act 936. Which market structure works the best,
based on:price, efficiency & production?
A. allowed stores to sell at whatever

price A. monopoly
B. Outlawed the practice of offering spe- B. oligopoly
cial prices to certain customers only. The
law was aimed at national organizations
and chain stores. D. monopolistic competition
C. Stores could set prices
937. Which of the following questions would
D. Price fixing be most helpful in determining the market
structure of a specific market?
933. A single price monopoly faces a linear de-
mand curve. If the marginal revenue for A. How far are goods shipped?
the second unit is $50, then marginal rev- B. How similar are the products?
enue for the
C. How many people want to buy?
D. How are the corporations organized?
938. Many (Most) sellers, Identical products

A. third unit is less than $50
B. third unit is more than $50
C. Oligopoly
C. third unit is also $50
D. Monopoly
D. first unit is less than $50
E. more info is needed. 939. Which of the following is most likely an
example of a monopoly?
934. The most extreme version of imperfect
A. A Starbucks across from Dunkin
competition is
Donuts
A. monopolistic competition.
B. A gas station in a town by itself
C. 3 fast food restaurants all on the same
C. monopoly. street
D. oligopoly. D. A Sainsbury’s 4 miles away from a
Tesco’s
935. An attempt by a seller in monopolistic
competition to convince buyers that its 940. Which of the following have limited life?
product is different and superior to nearly
identical products of competitors A. Sole proprietorship
A. Zoning B. Partnership
B. Patent C. Corporation
C. Advertising D. Sole proprietorship and partnership
D. Product Differentiation E. Corporation and sole proprietorship

941. SSEMI3a Which type(s) of business orga- C. Microeconomics

nization has/have “LIMITED LIFE”?
D. Home Economics
A. Corporation
B. Sole Proprietorship 947. What kind of chart is this?
C. Partnership A. horizontal bar chart

D. All of the above B. vertical bar chart
C. infographics
NARAYAN CHANGDER
942. Price fixing that occurs in an oligopoly
A. Collusion D. component bar chart
B. Product differentiation 948. Which of the following IS an economic car-
C. Competition tel?
D. Voluntary exchange A. FOMC
943. What is the underlying mechanism which B. OPEC

explains why a good does not become a C. NCAA
private one?
D. CPAC
A. Tragedy of the Commons
B. Negative Externalities 949. In amount of business done, it is the most
important type of business organization in
C. Positive Externalities
the U.S. today
D. Free Rider Problem
944. A natural gas producer buys a company B. Partnership
that owns natural gas pipelines that trans-
port gas to major urban areas. C. Corporation
A. Horizontal D. none of above
B. Vertical
950. How does international trade impact eco-
C. Conglomerate nomic growth within a trading nation?
D. none of above A. International trade allows industries
within a trading nation to increase market
945. There are very high barriers these in
power without losing customers.
these two market structures.
A. monopoly B. International trade allows a trading
nation to limit opportunity costs, making
B. monopolistic competition the market more efficient.
C. oligopoly C. International trade shifts the demand
D. pure / perfect competition curve of a trading nation outward, increas-
ing the purchasing power of industries.
946. is the study of economics on a small
scale. D. International trade shifts the produc-
tion possibility curve of a trading nation
A. Macroeconomics outward by using resources more effi-
B. Keynesian Economics ciently.

951. What type of monopoly is based on being 956. What government commission ensures
the only seller in an area? hiring practices are fair and non discrimi-
nating

A. technological monopoly
B. geographic monopoly A. OHSA
C. government monopoly B. EEOC
D. natural monopoly C. FDA

952. This market structure has 3-4 firms who
dominate 60-80% of the industry. 957. All sellers sell at that same, low market
A. Monopoly established price
B. Monopolistic Competition A. Product differentitation
C. Perfect Competitio B. Price takers
D. Oligopoly C. Collusion
D. none of above
953. Which type of business organization has
the advantage of limited liability but the
disadvantage of less control over business
is that
decisions?
A. products are high priced
B. there are several close substitutes for
B. partnership
the product
C. sole proprietorship
C. the product is unique with no close
D. corporation substitutes
954. When the allocation of goods by the free D. the product cannot be produced by
market is NOT efficient economists call it small firms
a :
959. What is the value of the next-best alter-
A. Market correction native when you make a trade-off?
B. Marketing success A. Gummy Bears
C. Marketing blunder B. Opportunity Cost
D. Market failure C. Scarcity
955. Suppose that elasticity of demand of D. Second-Best
socks is 0.7. If the price of socks is
reduced by 10%, how will sales be ef- 960. protect consumers against harm from
fected? products on the market.
A. sales will grow by more than 10% A. Franchises
B. Sales will grow by 10% B. Private property rights
C. Sales will grow by less than 10% C. Government regulations
D. Sales will decrease by 10% D. Profit motives

961. An economic system in which decisions on C. Cartels

production and consumption of goods and D. Commodities
services are made by individuals, buyers,
and sellers, NOT governments 966. In this market structure, products are
A. Market similar but have some differences.
A. Monopoly
B. Command
C. Traditional
NARAYAN CHANGDER
D. Mixed
D. Oligopoly
962. Sherman Anti-trust Act
967. The ability of some businesses to sell the
A. The Sherman Anti-trust Act is a state same product for different prices to differ-
law that promotes monopolies and re- ent groups of people-like airlines charging
stricts competition in the market. less for a ticket if you buy a month in ad-
B. The Sherman Anti-trust Act is a federal vance rather than the day before-is known
law that encourages monopolies and dis- as
courages fair competition in the market. A. price gouging
C. The Sherman Anti-trust Act is a federal B. price fixing
law that has no impact on monopolies or
C. price discrimination
fair competition in the market.
D. competitive pricing
D. To protect trade and commerce from
unlawful restraint and and monopolies. 968. SSEMI3 Which business organization is-
sues stocks?
963. Which of the following is an example of a
product sold in monopolistic competition? A. Sole Proprietorship
A. Cell Phone Service B. Corporation

C. Partnership
B. Eggs
D. Oligopoly
C. Shoes
D. Government Bonds 969. Impact on Consumer:Has many choices,
gets to choose which version of the prod-
964. How many firms are in a perfectly com- uct they like best, Prices are relatively rea-
petitive market? sonable for the product due to lots of com-
A. A few petition
B. One A. Perfect Competition

C. I’m not sure
C. Oligopoly
D. thousands or more
D. Monopoly
965. Goods that are provided by the govern-
ment (and paid for through taxation) are 970. The diagram shows the relationship be-
known as: tween a firm’s output and the number of
workers employed at different levels of
A. Private goods capital stock (K).What does the diagram
B. Public Goods show?

975. Consumers demand less of this type of

goods when their income increases.

A. Low grade rice
B. salt
C. bungalore
D. furniture
976. In which type of market structure can

A. the firm’s short-run rate of return on
long-run profit be positive?
capital
A. monopoly
B. the firm’s long-run rate of return on
capital B. oligopoly
C. the firm’s long-run total cost function C. monopolistic competition
D. the firm’s long-run production function D. perfect competition
971. An agreement among members of an 977. The purpose of a business engaging in a

oligopoly to illegally set prices and produc- conglomerate combination is to
tion A. reduce the risk of failure
A. Collusion B. make production more efficient
B. Cartel C. decrease competition and raise prices
972. In the meat smoker market, a NPF moves D. all of the above
the supply curve left. What happens to the
allocation of resources? 978. Which of the following is NOT true?
A. Moves left A. Competition is good for both buyers

and sellers.
B. Moves right
B. The setting of the price & quantity of
C. Increase goods sold is affected by the market struc-
D. Decrease ture that is in place.
C. The government intervenes in the mar-
973. In Monopolistic Competition you would
ket to prevent huge profits for businesses.
find that purchases are made generally
based on D. Lack of competition in business can
lead to an inefficient allocation of re-
A. supply/demand
sources.
B. brand loyalty
979. If two shops sell the same merchandise
C. price
but one offers a higher level of service, the
D. price of substitute products service distinction is a form of
974. The broccoli market would be an example A. nonprice competition

of B. choice among substitute products
A. Monopolistic Competition C. price fixing
B. Perfect Competition D. local competition

980. Companies are classified into a market B. Price-Setting Power

structure based on the which of the follow- C. Supply & Demand
ing characteristics?
D. Non-Price Competition
A. Competition
B. Success 986. The most common form of business orga-
nization is
C. Costs
A. the sole proprietorship.
D. Benefits
NARAYAN CHANGDER
B. the corporation
981. In perfect competition, the product is dif-
ferentiated C. the general partnership
A. True D. the franchise.
B. False 987. Kinsley bought a new house. The only

supplier of electrical power to her new
982. This market structure is characterized by
home is Georgia Power. This is an exam-
the lowest level of competition among pro-
ple of a monopoly.
ducers.
A. technological
B. geographic
B. monopoly
C. natural
C. oligopoly
D. perfect competition D. government
983. A way to attract customers by offering a 988. Federal Trade Commission Act
better quality product or a unique service A. Federal law that established the Fed-
(like the way Chick-Fil-A competes with eral Trade Commission (FTC) and regu-
Zaxby’s) is known as lates unfair methods of competition and
A. nonprice competition deceptive practices
B. monopolistic competition B. Federal law that established the Fed-
eral Trade Commission (FTC) and regu-
C. predatory pricing lates interstate commerce
D. collusion
C. Federal law that established the Fed-
984. What are the examples of oligopoly mar- eral Trade Commission (FTC) and en-
kets? forces antitrust laws
A. retail industry D. The FTC has the power to order a com-

pany to cease and desist unfair business
B. technology industry practices.
C. restaurant industry
989. Pepsi, Coca Cola
D. automobile industry, telecommunica-
tions industry, airline industry A. Oligopoly
B. Monopoly
985. Which IS NOT a characteristic of Market
Structures C. Perfect Competition
A. Number of Sellers D. none of above

990. Suppose a firm in a perfectly competi- A. economic loss.

tive market produces and sells 8 units of
B. economic profit.
output and has a marginal revenue of $8.

What would be the firm’s TOTAL revenue C. normal profit.
if it instead produced and sold 4 units of
D. accounting profit.
output?
A. $2 E. break-even profit.
B. $8 994. Select TWO benefits of competition in a

C. $32 market.
D. $64 A. higher prices
991. As a company produces larger numbers B. inferior products & services
of a product, the cost of each unit of the C. innovative products & services
product decreases. This is known as
D. lower prices
995. Why are wants insatiable?

A. they are endless
B. only services can satisfy them
C. they are different from needs
D. resources are unlimited
996. Explain the concept of price taker in per-

A. Economies of Scale fect competition.
B. Mass Production A. A firm that has no influence over the
C. Assembly Lines market price and must accept the price
D. Specialization set by the market.
B. A firm that can set its own price in the
992. An industry that is dominated by a few
market
large firms is
A. Perfect Competition C. A firm that has complete control over
the market price
D. A firm that can easily manipulate the
C. Oligopoly
market price
D. Monopoly
997. Economic profit is calculated by taking:
993. This firm is experiencing
A. Total Revenue-Explicit Costs
B. Total Revenue-(Explicit + Implicit
Costs)
C. Explicit Costs * Total Revenue
D. Total Revenue-Fixed Costs

998. How is a corporation different from a 1003. How does an oligopoly control price?
sole proprietorship? A. Through product differentiation
A. Corporations are owned by only one B. By being the only producer of a good
person
C. By working together to set prices
B. Corporations can sell stock to raise
D. It has no control over price
money for the business.
C. Sole proprietorships have limited liabil- 1004. A market in which producers sell similar
products, but not identical?
NARAYAN CHANGDER
ity for the owners.
D. Sole proprietorships require a legal A. perfect competition
charter to start the business. B. monopoly
999. Are allowed if the one sellers has a C. monopolistic competition
patent, is the government, or is not pur- D. oligopoly
posefully blocking competition
1005. All sellers in the perfect competition are
A. Perfect Competition sellers.
B. Monopolistic comeptition A. medium
C. Oligopoly B. large
D. Monopoly C. small
1000. Which markets compete in non-price D. extra large
competition?
1006. In a monopolistic market, how much
A. monopolistic competition and market power does the producer have?
oligopoly
A. Complete control
B. monopoly and monopolistic competi-
B. No market power
tion
C. Limited control
C. oligopoly and perfect competition
D. Shared control
D. perfect competition and monopolistic
competition 1007. Blueberry producers in Idaho are per-
fectly competitive, the market demand
1001. Beauty salons and clothing stores are curve for blueberries is
likely
A. nonexistent.
A. Monopolies
B. downward sloping.
C. horizontal.
C. Perfectly Competitive
D. upward sloping.
D. Oligopolies
1008. In this market structure there is only
1002. Perfect competition is characterized by one seller with a unique product
A. a large number of sellers and buyers. A. monopoly
B. diverse products. B. perfect competition
C. sellers acting together to set prices. C. monopolistic competition
D. uninformed buyers and sellers. D. oligopoly

1009. Which type of market structure is be- 1014. Collusion is legal in the U.S.?
ing described in the following quote? “To
A. True
make matters worse, health care consoli-

dation has led to the absence of any choice B. False
at all for consumers. Another study by
Harvard University on hospital markets 1015. Sweezy’ s Model explains the concept
found that between 2007-2017, 11.2 mil- of price rigidity relating to the following
lion Americans were served by just a sin- market forms
gle hospital system.”
A. Oligopolistic Market
B. Perfect Competition Market
C. Monopoly Market
C. Monopoly
D. Oligopoly D. Monopolistic Competition
1010. The demand curve for a perfectly com- 1016. Many buyers and sellers participate in
petitive firm is: the market. 2. Sellers offer identical prod-
A. perfectly inelastic. ucts. 3. Buyers and sellers are well in-
formed about products. 4. Sellers are able
B. perfectly elastic.
to enter and exit the market freely. Low
C. downward sloping. start-up costs and low technology needed.
D. relatively but not perfectly elastic.
1011. Benefit of Perfect Competition
A. Any Producer can enter market
B. Competition Lowers Prices
C. Both
D. Neither
1012. Barriers to entry =
B. make it difficult for new firms to enter A. Monopoly
the market
B. Oligopoly
C. factors of production
D. none of above
1013. In an oligopoly, when a few producers
join forces publicly to control pricing and 1017. What controls prices in Perfect Competi-
production levels (btw:it’s illegal in the tion?
US)
A. Sellers
A. COLLUSION
B. CARTEL B. Supply and Demand
C. TRUST C. Government
D. FEDERATION D. Advertisers

1018. Public Disclosure 1023. SSEMI3 Mr. Coleman’s lemonade busi-

A. release sale dates ness failed and he is in debt for over
$300K. He has to sell his house and live
B. list job openings under a garbage bag. This is an example
C. Requires businesses to reveal certain of his
information to the public. Stock exchange- A. corporate directors
Labels on foodBank reports filed with the
Federal Reserve System B. poor decision making
NARAYAN CHANGDER
D. list recalls C. unlimited liability
D. limited liability
a natural monopoly? 1024. A holder or owner of stock in a company
A. Coca Cola or corporation.
B. City of McKinney water service
C. United Airlines
D. Levi Jeans
1020. Multinational Corporations operate in

other countries and are also known as
A. Transnational Corporation A. stock market
B. Stifled Corporation B. shareholder
C. Expanded Corporation
C. portfolio
D. Transcontinental Corporation
D. industry
1021. What kind of graph is this?
1025. What is the main difference between
A. Multiple bar chart perfect competition and monopolistic com-
B. Component bar chart petition?
C. Histogram A. The main difference is that in perfect
competition, there are many small firms
D. Coloured bar chart
selling identical products, while in monop-
1022. Guy and his brothers want to start a olistic competition, there are many firms
plumbing business together. What is an selling similar but differentiated products,
advantage of organizing the business as a and they have some degree of market
partnership rather than a corporation? power.
A. Partnerships can be started up quickly. B. The main difference is that in perfect

competition, there are only a few large
B. Partnerships can issue stock to raise firms, while in monopolistic competition,
money. there are many small firms.
C. Partnerships have limited legal liabil- C. The main difference is that in perfect
ity. competition, there is no product differen-
D. Partnerships need a legal charter to tiation, while in monopolistic competition,
begin. there is no market power.

D. The main difference is that in perfect 1031. This type of business organization can
competition, there are barriers to entry, be owned by two or more people who
while in monopolistic competition, there share unlimited liability for business debts

are no barriers to entry. A. Sole Propriotorship
1026. Business model in which debt is shared B. Partnership
between two or more people C. Corporation
A. corporation D. none of above
B. sole proprietorship 1032. In a mixed economy, who plays a signif-
icant role in economic decision-making?
C. partnership
A. Only private individuals
D. none of above
B. Only government
1027. A monopoly that is based on the owner- C. Government and private individuals or
ship or control of a manufacturing method, businesses
D. International organizations
A. geographic monopoly
1033. What happens when the price of a par-
B. government monopoly ticular brand in monopolistic competition is
C. natural monopoly lowered?
A. Consumers shift to consuming that
D. technological monopoly
brand
1028. An entrepreneur can choose to have B. Consumers switch to a different mar-
which type of business organization? ket structure
A. Sole Proprietorship C. Consumers stop buying the product
B. Partnership D. Consumers become loyal to the brand
C. Corporation 1034. Which describes a barrier to entry?

D. All of the above A. Anything that protects a firm from the
arrival of new competitors.
1029. Few Large Sellers B. A government regulation that bars a
A. Perfect Competition monopoly from earning an economic profit
C. Something that establishes a barrier
to expanding output
C. Oligopoly D. Firms already in the market incurring
D. Monopoly economic losses so that no new firm
wants to enter the market
1030. An example of an oligopoly is
1035. Where can you NOT buy coca cola?
A. oranges
A. United Kingdom
B. cell phones B. North Korea
C. utilities C. Honduras
D. shoes D. South Africa

1036. The OPEC is comprised of 13 countries 1041. A monopoly is formed when there is
that possess about 80% of the world’s A. an abundance of resources
oil reserves. What market structure does
OPEC represent? B. a large profit
A. perfect competition C. no competition
B. monopoly D. anti-trust regulations
C. oligopoly
1042. SSEMI3 The type of business organiza-
NARAYAN CHANGDER
D. monopolistic competition tion with the potential for the longest lifes-
pan (i.e., “unlimited life”)
1037. Oligopoly and Pricing
A. Monopolistic competition and Pricing A. sole proprietorship
B. Perfect competition and Pricing B. corporation

C. Price-fixing is a form of collusion, and C. partnership
it is an agreement to set the same or sim- D. none of above
ilar prices for a product.
D. Monopoly and Pricing 1043. What is the supply curve for a Perfectly
Competitive Firm based on?
1038. Which of the following is an advantage A. The quantity of a good or service that
of a corporation? a firm is willing and able to consume at
A. limited liability different prices
B. easy to form B. The quantity of a good or service that
C. taxed only once a firm is willing and able to produce at dif-
ferent prices
D. shared losses
C. The quantity of a good or service that a
1039. Which economic system is based on pri- firm is willing and able to sell at different
vate ownership of resources and the use prices
of markets and prices to coordinate and di-
rect economic activity? D. The quantity of a good or service that a
firm is willing and able to buy at different
A. Feudalism
prices
B. Communism
C. Socialism 1044. How does monopolistic competition af-
fect pricing and output decisions?
D. Capitalism/Free Market
A. Monopolistic competition has no effect
1040. Keyshawn & Daniyah operate in a mar- on pricing and output decisions.
ket where there are a lot of sellers. Which
B. Monopolistic competition allows firms
of the following is true?
to have some control over pricing and out-
A. They are playing in market that is a put decisions.
partnership.
C. Monopolistic competition leads to
B. There are few barriers to entry. higher prices and lower output.
C. They are operating in an oligopoly. D. Monopolistic competition results
D. They cannot be operating in a monopo- in lower prices and higher output.
listically competitive market. tagsSSEMI3

1045. To which of the following modern sce- C. MC = 0

narios would Adam Smith MOST likely ob- D. MR = 0
ject?

A. The federal government provides in- 1049. If a single firm raises its price it will not
centives for farmers to limit agricultural be able to sell any of its output.
production. A. Perfect Competition
B. The president seeks to reduce the B. Pure Monopoly
number of pollution regulations imposed C. Monopolistic Competition
upon big business.
D. Oligopoly
C. Congress works with the president to
pass a bill to reduce tariffs (taxes) on im- 1050. Help to protect people from unexpected
port goods. events
D. none of above A. stability
1046. When the demand for a product or ser- B. growth

vice is higher than the supply this causes C. equity
what? D. security
the question below. Many sellers in mar-
ketProducts are identicalEasy to enter and
exit the marketPrice takers The above
headlines are all examples of
B. Pure (perfect) competition
A. shortage
C. Oligopoly
B. consumer
D. Monopoly
C. surplus
1052. Which of the following is a condition of
D. equilibrium
perfect competition?
1047. If wages were automatically adjusted
for changes in the price level, the short-
runaggregate supply curve would most
likely be:
A. flatter.
B. steeper.
C. unchanged.
D. none of above
1048. What is the condition for revenue max- A. products produced by rival firms are
imisation? perfect substitutes
A. MC > MR B. individual firms can affect market sup-
B. MC = MR ply

C. industry sales are small 1058. Which one of the following is an ideal
D. restricted entry and exit market structure in which consumers and
producers each compete directly under the
1053. Zoe’s Bakery determines that P < ATC laws of supply and demand?
and P > AVC. Zoe should: A. oligopoly
A. continue to operate even though she is
B. copyright
taking an economic loss.
C. natural monopoly
B. continue to operate, as she is making
NARAYAN CHANGDER
an economic profit. D. perfect competition
C. shut down immediately, as she is tak-
1059. Which of the following is the best exam-
ing an economic loss.
ple of a standardized product?
D. raise the price until she has maximized
her profits. A. Car
B. Boots
1054. A situation in which many businesses
compete for customers is called C. Cereal
A. Perfect Anarchy D. Skim Milk
B. Perfect Competition 1060. Sellers in a Perfect Competition market
C. The Free Market structure are because the products in
D. Monopoly their markets are sold at the equilibrium
price.
1055. As it becomes easier to start a new busi-
ness in a market, that market
A. attracts more consumers.
B. increases transaction costs.
C. become more competitive.
D. offers higher-quality products.
1056. With monopolistic competition there are A. Price Takers

A. few sellers and few buyers B. Price Changers
B. few buyers but many sellers C. Trailblazers
C. many buyers and many sellers D. Price Makers
D. none of above
1061. The demand curve for a perfectly com-
1057. Every firm no matter what maximizes petitive firm is:
its profits where
A. perfectly inelastic.
A. marginal cost equals marginal rev-
enue B. perfectly elastic.
B. total costs exceed marginal revenue C. downward sloping.
C. price times quantity sold D. relatively elastic.
D. the manager thinks it is best E. relatively inelastic.

1062. How is a corporation different from a C. The sellers control the market price.
sole proprietorship? D. Sellers can enter and exit the market

A. Corporations are owned by only one easily.
person E. There are many buyers and sellers.
B. Sole proprietorships have limited liabil-
ity for the owners 1068. Which of the following is NOT a feature
of a monopolistic competition?
C. Corporations can sell stock to raise
money for the business. A. Numerous sellers
D. Sole proprietorships require a legal B. Product differentiation
charter to start the business. C. Numerous buyers
1063. Who runs corporations? D. Homogenous price
A. the ceo 1069. What is an example of a monopoly?
B. board of directors A. Taco Bell
C. secretary B. National Hockey League (NHL)
D. stockholders C. Lucky Brand Jeans
1064. Firms in monopolistic competition D. Holiday Inn
A. All produce exactly the same product
1070. Airlines in the US are in what type of
B. All charge the same price market structure?
C. All earn the same profit A. Monopoly
D. All work to differentiate their products B. Oligopoly
1065. Attempt to make a product stand out C. Perfect Competition
from similar products D. Monopolistic Competition
1071. Which type of competition allows any-
B. Nonprice Competition one to participate in the market?
C. Predatory pricing A. Monopolistic Competition
D. Product Differentiation
B. Perfect Compeition
1066. Type of merger in which companies that C. Both Monopolistic and Perfect Compe-
sell similar products merge tition
A. vertical D. Oligopoly
B. horizontal
1072. What group of people ultimately holds
C. conglomerate the most power in a free enterprise sys-
D. none of above tem?
A. consumers
1067. The 4 conditions for a purely / perfectly
competitive market are: B. business owners
A. The products are identical. C. entrepreneurs
B. Buyers know a lot about the product. D. the government

1073. Public goods include C. wealthy people who inherited their for-
A. banking and other financial services. tures
B. child-care services. D. businesses that have become monopo-

lies
C. computer repair services.
D. fire and police services. 1079. What is an oligopoly?
1074. In this business organization jobs can be A. one firm producing 95% of the output
split on areas of expertise
NARAYAN CHANGDER
B. Two to four firms producing the major-
ity of the output
B. partnership
C. 80 firms producing 90% of the output
C. franchise
D. corporation
1075. Factors that make it difficult for new 1080. If potential profits in a market are lim-
firms to enter a market are called ited by location, what type of monopoly
A. Barriers to entry tends to develop?
B. Factors of production A. Geographic Monopoly

C. Limited supply B. Government Monopoly
D. Monopolistic Outlook C. Technical Monopoly
1076. A market structure is the organization D. Natural Monopoly
of a industry mainly by the degree of
A. Competition 1081. M n p l st cc mp t t n
B. Success means
C. Costs A. oligopoly
D. Benefits B. monopolistic competition
1077. Why does no one firm dominate in a per-
1082. What is the relationship between com-
fect competition?
petitive behaviour and competitive market
A. No firm wants to structure?
B. Each firm sells to different people A. Competitive market structure is de-
C. Each firm produces so little of the total termined by government regulations, not
supply that they cannot influence prices competitive behavior.
D. One firm will eventually dominate and B. Competitive behavior has no impact on
make it a monopoly the competitive market structure.
1078. In economics and in the law, the term C. Competitive behavior is inversely re-
“trust” refers to lated to the competitive market structure.
A. business owners that believe in the D. The level of competitive behavior is di-
law rectly related to the competitive market
B. banks that loan funds to businesses structure.

1083. A is a market structure character- C. monopolistic competition

ized by only one seller of a product dom- D. perfect competition
inating the market. (Example:electrical

power companies and cable television com- 1088. Between 1990 and 2003, the United
panies in certain areas) States saw a decrease in its share of
global high-technology exports. Based on
A. oligopoly
the data in the table, which trading part-
B. monopsons ner experienced the greatest benefit while
C. perfect competition the market share of the United States de-
creased?
D. monopoly
1084. With respect to the circular flow model,

businesses provide households with which
of the following?
A. taxes and interest A. European Union
B. labor and taxes B. Japan
C. goods, services, and incomes C. Germany
D. public goods and transfer payments D. China
1085. What is monopolistic competition? 1089. This market has no control over price
A. When many suppliers produce the A. Monopolistic competition
same goods B. Oligopoly
B. When a few firms dominate the market C. Monopoly
C. When there is only one major supplier D. Perfect competition
D. When several companies sell similar 1090. Firms in a market that is perfectly com-
products petitive produce goods that are perfect
substitutes for each other
1086. Price Control:Can the individual firms in
the market for a product exercise any con- A. TRUE
trol over the price they charge? If not, B. FALSE
they are called a price-taker because they
must accept the market price as their own. 1091. How does the decision-making process
The weaker the control over price, the differ between a monopoly and a pure com-
more the market. petition market?
A. regulated A. Decisions made in a monopoly are
made by consumers, while the producers
B. oligopolistic make the decisions in pure competition.
C. monopolistic B. Decisions in a monopoly are made by
D. competitive the producer, while consumer demand de-
termines decisions in pure competition.
1087. The market for agricultural produce is an
example of: C. Decisions made in a monopoly are de-
termined by demand, while decisions in
A. monopoly pure competition are determined by sup-
B. oligopoly plyand price.

D. Decisions in a monopoly are deter- 1097. In California, blueberry growers are

mined by profit and demand, while deci- price takers. The reason they are price
sions in pure competition are determined takers is because there are blueberry
byprofit and supply. growers in this area
A. a few
1092. Firms in an oligopoly
B. one
A. Are totally independent from each
other C. many
NARAYAN CHANGDER
D. more than two but not many
B. Are interdependent
C. Have no control over the price 1098. Which market structure has high barri-
ers to entry, firms engage in strategic be-
D. None of these above havior, and a small number of large firms
dominate the market?
1093. One of the ways a corporation can raise
money is by A. Perfect Competition
A. selling stock on the stock market.
C. Oligopoly
B. buying bonds from other corporations.
D. Monopoly
C. seeking money from the government-
for research and development. 1099. In which market are firm’s products al-
ways exactly the same (otherwise known
D. selling shares to the founders.
as homogeneous)?
1094. Monopoly A. monopoly
A. A monopoly exists when the producer B. oligopoly
of a products has no close substitutes. C. monopolistic competition
B. Video game D. perfect competition
C. Card game 1100. If the technology associated with pro-
D. Board game ducing artificial intelligence (AI) continues
to advance, over time the cost of produc-
1095. When businesses charge different ing AI will
prices to customers for the same ser-
vice/product, it is called:
A. trust-busting
B. public disclosure
D. none of above
A. decrease, firms that use the new tech
1096. Cartel is a group of firms that collude to
will earn an economic profit, and in the
produce the monopoly output and sell at
long run, new firms will enter
the monopoly price.
B. decrease, firms that do not use the
A. True
new tech will earn an economic profit and
B. False in the long runs new firms will enter.

C. increase, firms that use the new tech B. anti-trust

will earn an economic profit and in the C. anti-competition
long runs new firms will enter.

D. prohibition
D. increase, firms that use the new tech
will incur an economic loss, and in the long 1105. If a town has only one gas station then
run, some firms will exit the market for gas in that town is in which
E. decrease, firms that use the new tech market structure?
will incur an economic loss, and in the long A. Perfect Competition
run, some firms will exit B. Monopolistic Competition
1101. If the ABM firm sells homogenous prod- C. Oligopoly
ucts in a market, with a single seller and D. Monopoly
many buyers, for which there are no close
substitutes to the products, it is a/an 1106. If a market has low competition, usually
A. monopolist start-up costs are
B. oligopolist A. high
C. perfect competitor B. low
D. monopolistic competitor 1107. Bruce Wayne has owned Wayne Enter-
prises since the death of his parents at an
1102. If a general partnership fails, who is re-
early age. Bruce is ready to sell all of his
sponsible for the debts?
stock in the company to retire and live com-
A. anyone who works for the partnership fortably.
B. all of the partners
C. only the most senior general partner
D. the state in which the business is oper-
ated
1103. If a perfectly competitive firm is cur-

rently producing a level of output at which
marginal revenue (MR) exceeds marginal A. Sole-proprietorship
cost (MC), then B. Partnership
A. A one-unit increase in output will in- C. Corporation
crease the firm’s profit D. none of above
B. A one-unit decrease in output will in-
crease the firm’s profit 1108. In a monopoly, the firm is the industry
C. total revenue exceeds total cost A. true
D. total cost exceeds total revenue B. false
1104. Huge monopolies dominated the Amer- 1109. What kind of market runs most effi-
ican marketplace in the late 1800s. This ciently when one large firms supplies all
lead the US Gov’t to set ( ) laws to of the output?
break them up. A. Perfect competion
A. bankruptcy B. Natural monopoly

C. Imperfect competion market structure he is MOST likely partic-

D. Technology monopoly ipating in is
1110. Government requirements that promote
B. oligopoly
transparency are an attempt to prevent
market failures caused by C. perfect competition
A. externalities D. monopoly
B. resource immobility
NARAYAN CHANGDER
1116. Land, labor, capital, and entrepreneur-
C. insufficient competition ship are
D. insufficient information A. economics
B. ethics
1111. Where supply and demand come to-
gether. C. factors of production
A. equilibrium D. Gross domestic Product (GDP)
B. supply 1117. In monopoly in long run equilibrium:
C. output A. The firm is productively efficient
D. Starlord B. The firm is allocatively inefficient
1112. A major producer of automobiles buys a C. The firm produces where marginal
large rental car company. cost is less than marginal revenue
A. Horizontal D. The firm produces at the socially opti-

mal level
B. Vertical
1118. In the sneaker market, a NPF moves the
C. Conglomerate
supply curve right. What happens to the
D. none of above allocation of resources?
1113. The market which offers a homogenous A. Moves left
product: B. Moves right
A. Perfect competition C. Increase
B. Monopolistic competition D. Decrease
C. Oligopoly 1119. Given the demand curve pictured, if the
D. Monopoly price increases from $3 to $6 per unit, to-
tal consumer surplus will:
1114. Limited liability corporation=
A. stockholders can only loose what they
invested only
B. stockholders can loose everything
1115. If Mark wants to sell his corn at a local

farmer’s market, he must be aware that
the product is standardized and that he
will have no control over the price. The A. decrease by $9

B. decrease by $27 1125. Which market structure is considered a

C. decrease by $36 “price maker” because they have total con-
trol over price?

D. increase by $30
E. remain constant
1120. How many sellers are in a perfectly com- C. Oligopoly
petitive market?
D. Monopoly
A. Many
1126. The first government attempt to stop
B. Few
anti-competitive behavior was
C. Unknown
A. The Sherman Antitrust Act
D. It depends on the product
B. The Federal Trade Commission
1121. ability of a company to control prices C. The Celler-Kefauver Antimerger Act
and total market output
D. The Clayton Act
A. market power
1127. A monopoly owned and operated by the
B. price discrimination government
C. license A. natural monopoly
D. government monopoly B. technological monopoly
1122. How many teeth does a normal adult C. geographic monopoly
mouth have? D. government monopoly
A. 34
1128. The minimum legal price that an em-
B. 32 ployer may pay a worker for one hour of
C. 24 work
D. 40 A. Maximum Wage
B. Rationing
1123. The only “In and Out” in town
C. Minimum Wage
A. Natural
D. Competitive Wage
B. Government
C. Technological 1129. Which of the following is NOT a charac-
teristic of a monopoly?
D. Geographic
A. There is only one firm in the market
1124. If an industry is relatively cheap for new
B. There are no close substitutes for the
firms to enter, but consumers care about
firm’s product.
quality differences it is probably which
market structure? C. The firm faces a perfectly elastic (hor-
izontal) demand curve for its product
D. There are high barriers to entry into
B. oligopoly the market.
C. monopoly E. The firm’s marginal revenue is less
D. monopolistic competition than the price it charges.

1130. Which trait or characteristic would de- 1135. A lone convenience store in a small town
scribe a successful entrepreneur? is an example of what?
A. Lazy A. Natural monopoly
B. Shy B. Geographic monopoly
C. Bossy C. Government monopoly

D. Technological monopoly
D. Self Starter
NARAYAN CHANGDER
1136. There is no single seller or buyer can
1131. Entry into monopolistic competition or influence the change in market price of a
oligopoly is not free, but it is possible product.
A. TRUE A. Pure Competition
B. FALSE B. Monopolistic Competition
C. Pure Monopoly
1132. Patents are a form of monopoly that so-
ciety allows because they D. none of above
A. maintain an orderly way for companies 1137. If the government sets a minimum wage
to make a lot of money. at $24
B. give companies the right to decide who
will be allowed to use their products.
C. set up a situation in which only a few
manufacturers can control an industry.
D. encourage firms and people to re-
search new products that benefit society
as a whole. A. 0 hours will be demanded
1133. A market that runs most efficiently B. 12 hours will be demanded
when one large firm provides all of the out- C. 4 hours will be demanded
put D. 8 hours will be demanded
A. Natural Monopoly
1138. This type of business is owned by one
B. Monopoly person.
C. Government Monopoly A. Sole Proprietorship
D. Oligopoly B. Partnership
C. Corporation
1134. If prices decrease the supply producers
are willing to make D. Franchise
A. also decreases 1139. Local Water company

B. rises A. Natural
C. stays the same B. Government
D. suppliers will stop making products C. Technological

completely D. Geographic

1140. What letter on the graph represents the D. Natural-ownership or control of a man-
proper location for the market structure ufacturing method, process, or other sci-
“oligopoly”? entific advance.Geographical-monopoly

based on the absence of other sellers in
a certain geographic area Technological-
production of a product from a single firm
1143. Which market structure would be con-

A. W sidered the most competitive because it
has the most number of sellers?
B. Y
A. perfect (pure) competition
C. X
D. Z
C. oligopoly
1141. Series of price reductions that may be- D. monopoly
come so drastic that each seller suffers con-
siderable losses. 1144. Mia, Noah, and David are discussing
A. Price war market structures in their economics class.
They come across the term ‘oligopoly’.
B. Collusion What does it mean?
C. Patent A. A market structure characterized by a
D. Anti-Trust Legislation large number of small firms dominating
the market.
1142. There are 3 types of monopolies identify B. A market structure characterized by a
which of the following answer is correct. single firm dominating the market.
A. Natural-production of a prod- C. A market structure characterized by
uct from a single firmGeographical- equal market share among all firms.
ownership or control of a manufactur-
ing method, process, or other scientific D. A market structure characterized by a
advance.Technological-monopoly based small number of large firms dominating
on the absence of other sellers in a cer- the market.
tain geographic area
1145. Which of the following is another word
B. Natural-production of a product from a for equilibrium?
single firmGeographical-monopoly based
A. balance
on the absence of other sellers in a certain
geographic area Technological-ownership B. bargaining
or control of a manufacturing method, pro- C. benchmark
cess, or other scientific advance.
D. example
C. Natural-ownership or control of a
manufacturing method, process, or 1146. Competition is (a) for consumers be-
other scientific advance.Geographical- cause it leads to (b) prices and (c) choices
production of a product from a single for them. In addition, competition also re-
firmTechnological-monopoly based on the sults in (d) quality products. This is not the
absence of other sellers in a certain geo- case with a (e), where one seller controls
graphic area the market.

A. a beneficial 1151. What gives a company exclusive rights

B. b lower to sell a new product for a specific amount
of time?
C. c greater
A. Franchise
D. d higher
B. Barrier to Entry
E. e monopoly
C. Patent
1147. A Externality occurs when a cost of D. Commodity
NARAYAN CHANGDER
production or consumption falls on a 3rd
Party. 1152. A monopoly can price discriminate be-
tween two groups of consumers if each
A. Negative group has
B. Neutral A. a large consumer surplus.
C. Positive B. a different willingness to pay.
D. none of above C. the same willingness to pay.
1148. Who benefits the most from perfect D. the ability to resell the good to the
competition? other group.
A. sellers 1153. What is a feature of monopolistic com-
B. producers petition, but not of a perfect market?
A. a small number of buyers
C. consumers
B. product differentiation
D. suppliers
C. the existence of abnormal profits
1149. Monopolistically competitive firms are D. the existence of barriers to entry
considered inefficient in allocating soci-
ety’s resources for which of the following 1154. A benefit of a nonprofit corparation is
reasons? that it
A. In long-run equilibrium, the marginal A. pays dividends to share holders
benefit exceeds the price charged by the B. has earnings are exempt from state
firms. and federal taxes
B. In long-run equilibrium, the price is C. is exempt from filing paperwork
greater than the marginal cost.
D. has limited liability for shareholders
C. In long-run equilibrium, average total
costs are minimized. 1155. In a kinked demand model oligopoly,
firms tend to produce at
D. In long-run equilibrium, the firm is
earning economic profits.
1150. What is liability

A. Being responsible for all financial
losses
B. Meeting deadlines on time
C. Being able to pay employees
D. Lies

A. A. C. trust busting
B. B. D. antitrust laws

C. E.
1161. Which type of business is the most com-
D. no where, they would shut down.
mon in the United states?
E. the highest price.
1156. The actions of an individual seller do not
affect the overall supply or price of a good B. A conglomerate
or service. C. A cooperative
A. Perfect Competition D. A corporation
B. Pure Monopoly
C. Monopolistic Competition 1162. The combination where Firm A adver-
tises and Firm B does not advertise is Nash
D. Oligopoly equilibrium because
1157. Patents are an example of a
A. natural monopoly
B. government monopoly
C. geographic monopoly
D. technological monopoly
1158. The market for milk is an example of

perfect competition. Why?
A. Sellers offer a nearly identical product A. it is best for each firm given what the
B. Anyone can start a dairy farm or leave other firm has chosen
the dairy business at any time B. the total industry profits are maxi-
C. Many people buy and sell milk mized
D. All of the above C. Firm A has an incentive to change its
strategy and chooses not to advertise
1159. A firm in the long run will make
A. Losses D. it is the best outcome for Firm B re-
gardless of what firm A does
B. Economic Profit
E. advertising is always the best strategy
C. Profits greater than MC
for Firm A
1163. Agricultural goods are the best exam-
1160. The federal government has a number
ples
of policies that keep firms from control-
ling the price and supply of certain impor- A. Perfect Competition
tant goods. The government policies are
known as B. Monopolistic Competition
A. predatory pricing C. Oligopoly

B. deregulation D. Monopoly

1164. In this market, a good is protected from 1169. The combination of two or more firms
competition by a patent. involved in different stages of producing
the same good or service is known as
B. Pure Monopoly
D. Oligopoly
NARAYAN CHANGDER
1165. The most important characteristic that
distinguishes one market structure from A. Multinationals
another is the size of the firms in the mar-
B. Vertical Mergers
ket
C. Comglomerates
A. TRUE
D. Horizontal Mergers
B. FALSE
1170. Suppose when a monopolist produces
1166. In this market structure there is little of 50 units its average revenue is $8 per
no difference between the product no mat- unit, its marginal revenue is $4 per unit,
ter what company produces it? its marginal cost is $4 per unit, and its av-
A. Perfect Competition erage total cost is $3 per unit. What can
we conclude about the monopolist?
A. The monopolist is currently maximizing
C. Oligopoly its profits, and its total profits are $200.
D. Monopoly B. The monopolist is currently maximiz-
ing its profits, and its total profits are
1167. Which of the following is an example of $250.
a natural monopoly? Text to speech
C. The monopolist is not currently maxi-
A. the water system that serves the mizing its profits; it should produce more
greater Boston metropolitan area units and charge a lower price to maxi-
B. millionaire John D. Rockefeller’s Stan- mize profit.
dard Oil Company D. The monopolist not currently maximiz-
C. he only sandstone quarry in ing its profits; it should produce fewer
Menomonie, Wisconsin units and charge a higher price to maxi-
mize profit.
D. author J.K. Rowling’s copyright for her
Harry Potter novels 1171. An example of a monopoly
1168. Marginal costs are based on changes for A. utilities

the firm’s B. auto industry
A. average fixed costs C. airlines
B. variable costs D. none of above
C. market structure
1172. What does “positive externality”
D. Marginal revenue mean?

A. It is the cost that is involved in the pro- 1177. Which market structure has a small num-
duction & consumption of a good or ser- ber of producers with a large amount of
vice. control?

B. It is the benefit enjoyed by a third party A. Perfect competition
from the consumption of a good or ser- B. Monopolistic competition
vice.
C. Oligopoly
C. It is the benefit that a person derives
D. Monopoly
from consuming a certain good or service.
D. It is the benefit that merit goods bring. 1178. What are the main characteristics of
oligopoly?
1173. Market where many producers offer A. Few firms, independent, high barriers
similar, but not identical goods or services. of entry
A. Oligopoly B. Few firms, interdependent, high barri-
B. Monopolistic Competition ers of entry
C. Perfect Competition 1179. Which market structure has a single firm
D. Monopoly or entity as the sole seller or producer of
a particular product or service?
1174. are associations of individuals or
companies that perform business functions
for their members. B. Monopolistic Competition
A. S Corporations C. Oligopoly
B. Government Owned Corporations D. Monopoly
C. Not for Profit 1180. SSEMI3 b WOW and Comcast, the only
D. Cooperatives two internet service providers in Evans,
meet secretly to decide to set prices very
1175. refers to a market structure char- high. This is an example of
acterized by a large number of buyers A. Collusion
and sellers of products that are simi-
B. A price war
lar to one another that can be differen-
tiated by brand, quality, etc. (Exam- C. Monopolistic Competition
ples:restaurants and retail clothing sell- D. Monopoly
ers)
1181. One of the reasons aggregate demand
A. perfect competition curve is downward sloping is because
B. monopolistic competition alower price level means that the real ex-
C. oligopoly change rate:
D. monopsons A. depreciates, making domestic goods
cheaper in other countries and import-
1176. Which is the ideal market structure sless competitive, resulting in a higher
A. Monopolistic competition level of net exports.
B. Oligopoly B. appreciates, making domestic goods
more expensive in other countries andim-
C. Perfect competition ports more competitive, resulting in a
D. Monopoly higher level of net exports.

C. appreciates, making the country’s ex- prefer their product to their competitors’
ports and imports less competitive and products.
leading to lower net exports. C. dominated by fierce advertising cam-
D. none of above paigns
1182. Which of the following companies were D. none of above

one of the first to be regulated by the gov- 1187. If an industry is relatively cheap for
ernment? new firms to enter, but consumers do not
NARAYAN CHANGDER
A. electric companies care about quality differences it is proba-
B. transportation companies bly which market structure?
C. phone companies A. perfect competition

B. oligopoly
D. All of the Above
C. monopoly
1183. illegal combination of corporations or
companies organized to suppress competi-
tion 1188. It is extremely easy to go into and get
A. Trust out of the business. Select all that apply
B. Collusion A. Perfect Competition
C. Corruption B. Pure Monopoly
D. Cartel C. Monopolistic Competition
D. Oligopoly
1184. Market structure where alternatives for
its products are limited. 1189. Differentiation is
B. Oligopoly
D. Monopoly
1185. A business that cannot set the prices it-

self, but accepts the market price
A. having identical products.
A. Price maker
B. copying another business.
B. Price taker
C. small differences that make your prod-
C. Monopoly
uct unique.
D. Cartel
D. having control of the market value.
1186. The market type known as perfect com- 1190. Which of the following is the most com-
petition is petitive market structure?
A. highly competitive and firms find it im- A. pure oligopoly.
possible to earn an economic profit in the
long run B. perfect competition.
B. marked by firms continuously trying to C. differentiated oligopoly.
change their products so that consumers D. monopolistic competition.

1191. Which of the following is the most com-

petitive market structure?

C. Oligopoly
D. Oligopoly A. only to the Securities Exchange Com-
mission
1192. This market structure has some barriers
B. only to family members close friends
to entry but they are typically low
C. on the open market, such as the New
A. Monopoly
York Stock Exchange
B. Oligopoly D. only to existing stockholders
1197. Is exploitation common to monopolists?
A. yes
1193. There are types of market struc- B. no
tures.
1198. Natural monopolies typically have high
A. different fixed costs, so only one firm is able to
B. similar serve the market at a profit
C. identical A. TRUE
D. none of above B. FALSE
1199. Greater control over prices, higher

1194. Oligopoly is an imperfectly competitive
prices, but still affordable for many, some-
market structure containing firms.
times shortages are created to jack up
A. A few prices, little competition, good size profit,
B. Numerous will sometimes work together to run oth-
ers out of the market or increase their prof-
C. Option 3 its.
D. none of above A. Monopoly
B. Oligopoly
1195. Oligopolies and monopolies are the
same because C. Monopolistic Competition
A. They both have many buyers and sell- D. Perfect Competition
ers.
1200. True or False:In monopolistic competi-
B. They both are the only sellers of their tion, products are identical.
product. A. True
C. They both have identical products. B. False
D. They both have high barriers to entry.
1201. Jeans, books, shampoo, cereal are ex-
1196. Publicly Held corporations sell their amples
stock A. Perfect Competition

B. Monopolistic Competition 1206. SSEMI3 Which business has the great-

C. Oligopoly est degree of decision-making for a single
person?
D. Monopoly
A. corporation
1202. Which is NOT one of the 3 Cs of eco- B. sole proprietorship
nomics?
C. partnership
A. Containment
D. none of above
NARAYAN CHANGDER
B. Choice
C. Cost 1207. In this market, there are no available
substitutes:
D. Consequences
1203. No control over prices, lowest possible
prices, production= at equilibrium, price
competition only, small profit and great ef- C. Oligopoly
ficiency in this market D. Monopoly
A. Monopoly
1208. Which best describes the goal of a
B. Oligopoly monopoly?
A. Maximize profits
B. Address Consumer Concerns
1204. What kind of market structure is effi- C. Lower Barriers to Entry
cient with 1 business supplying?
D. Improve products
1209. SSEMI3 Which of the following is NOT

one of the three types of business organi-
zations?
B. Partnership
C. Corporation
D. Oligopoly
A. natural monopoly 1210. SSEMI3 b A produce market, with many

different farmers selling corn, tomatoes,
B. oligopoly
peppers, etc., (identical products) but the
C. imperfect competition farmers have no control over their prices.
D. perfect competition This would probably be considered what
type of market structure?
1205. Deregulation means that the govern-
A. Monopoly
ment no longer decides what role each com-
pany can play in a particular market. B. Oligopoly
A. True C. Monopolistic Competition
B. False D. Perfect Competiton

1211. Since the firm that controls the market D. There are no barriers of entry
is a , controlling both the price and
quantity produced of their product, a com- 1215. In a perfect competition all the sellers of

pany that is a monopoly can practice the market are small sellers in competition
and with each other.
A. True
B. False
1216. What condition differentiates a market

of pure competition from one of monopo-
listic competition?
A. Price Maker; Fair Pricing and Trans- A. price
parency
B. competition
B. Price Taker, disequilibrium and Price
Gouging C. products
C. Price Taker, Collusion and uses the D. firms
Equilibrium Price
1217. Combination of two or more companies
D. Price Maker, Price Discrimination and into a single firm
Collusion
A. merger
1212. Difficult to nearly impossible for new B. buy out
firms to enter
C. take over
A. Perfect competition and monopolistic
competition D. horizontal merger
B. Perfect competition and oligopolies 1218. In this market, one firm controls the
C. Oligopolies and monopolies market, there are very high barriers to en-
try, price makers, & there are no available
D. Monopolies and monopolistic competi-
substitutes
tion
1213. As a market structure, offers goods
and services that do not have substitutes B. Oligopoly
outside the industry. C. Monopoly
A. monopoly D. none of above
B. oligopoly
1219. Philip’s Phantastic Pharmaceuticals
C. monopolistic competition (PPP), Inc. currently has a patent-and
D. pure competition therefore a monopoly-on the market for
a drug called spazoprolam. After PPP’s
1214. Which of the following statements is patent expires and the market for spazo-
not true of firms in perfect competition prolam becomes perfectly competitive, the
A. All producers charge the same price price of spazoprolam will most likely
and the quantity sold will most likely
B. All producers make the same product
C. Each firm tries to sell more by reduc- A. fall; fall
ing its price B. rise; rise

C. rise; fall 1225. which of the following is not a barrier

D. fall; rise to entry?
A. Control of a natural resource
1220. Choose the example that goes best with B. Economies of scale
an oligopoly.
C. government sanctioned legalities
A. apples
D. loan shark laws
B. cell phone providers
1226. The area of would represent the
NARAYAN CHANGDER
C. utilities area of
D. clothing
1221. The public interests is

A. the concerns of the public as a whole.
B. the right to buy and sell goods.
C. the right of individuals to have safe
products.
D. a property right guaranteed by law.
A. BGHC; loss
1222. SSEMI3 b If you live in Au- B. FHJ; consumer surplus
gusta/Richmond County and do not have C. AFGB; profit
a well system, then you are on city water
and sewer. This is an example of a D. BGM0; producer surplus
E. BGM0; total revenue
A. Monopoly
B. Oligopoly 1227. Which of the following is the least com-
petitive market structure?
1223. In monopolistic competition firms profit C. Oligopoly
maximize where: D. Monopoly
A. Marginal revenue = Average revenue
1228. Which of the following correctly orders
B. Marginal revenue = Marginal cost market structures from least efficient to
C. Marginal revenue = Average cost most efficient? (Keep in mind that all op-
tions may be inefficient.)
D. Marginal revenue = Total cost
A. oligopoly-monopoly-monopolistic com-
1224. Reducing or eliminating government petition
control of business is called B. monopoly-oligopoly-monopolistic com-
A. Deregulation petition
C. monopoly-mopolistic competition-
B. Cease and desist
oligopoly
C. Disclosure D. monopolistic competition-oligopoly-
D. Discrimination monopoly

1229. follows these conditions:few sellers; 1233. True/False:Cartels and collusion are le-
high barriers to enter market; some con- gal in the United States.
trol over the price; some differentiated

products
C. oligopoly
D. monopoly
1230. The allocatively efficient point on this A. True
graph would occur at point
B. False
1234. A shared good/service that govern-

ment builds because it would be impracti-
cal for an individual
A. private good
B. public good
C. military good
D. market failure
A. J
B. F 1235. affects BOTH quantity demanded
and quantity supplied, as it causes move-
C. L
ment ALONG the curve.
D. G
A. price
E. K
B. savings
1231. The market for crude oil is an example
C. entrepreneurship
of an oligopolistic market
D. land
A. TRUE
B. FALSE 1236. What type of market structure has a
few firms, and a lot of control over price?
A. perfect competition A. Perfect Competition

B. oligopoly B. Oligopoly
C. monopoly C. Monopolistic Competition
D. monopolistic competition D. Monopoly

1237. This allows an inventor exclusive rights 1242. Why are geographic monopolies com-
to make and sell his or her invention. mon in small towns?
Other producers may apply for a license A. Small towns can’t afford police secu-
for a fee. rity for new shops.
A. Patent B. Small towns usually have just one
B. Bill of Attainder seller of a given item.
C. Patience C. The residents of small towns vote
NARAYAN CHANGDER
against having new shops.
D. Mortgage
D. The residents of small towns don’t
1238. Characteristics of equilibrium include want jobs from new shops.
A. where supply and demand intersect 1243. Sells Identical products

B. where QS = QD A. Perfect Competition
C. no shortage and no surplus B. Monopolistic Competition

C. Oligopoly
D. all of these
D. Monopoly
1239. In Atlanta, the market for Zoo’s is dom-
inated by the Atlanta Zoo. 1244. Name this famous cartoon cat?

C. Oligopoly
D. Monopoly A. Sylvester the Cat
B. Tom cat
1240. What is 111-26 =
C. Felix the Cat
A. 86
D. Cheshire Cat
B. 85
1245. When companies compete in a market
C. 137 economy, what is usually the result?
D. 95 A. Consumers are able to buy goods for
the best available price.
1241. AT&T, Verizon, and T-Mobile are an ex-
B. People pay much higher prices for
ample of a(n)
goods.
A. Monopoly
C. There are frequent shortages of goods
B. Oligopoly on the market.

D. Producers refuse to sell some of their A. Price Floor

products. B. Regulation

1246. If the cross-price elasticity between C. Competitive Pricing
two commodities is 1.5, D. Rationing
A. the two goods are luxury goods.
1250. In long run equilibrium, a perfectly com-
B. the two goods are complements. petitive firm will tend to earn
C. the two goods are substitutes. A. zero accounting profit
D. the two goods are normal goods. B. zero economic profit
1247. Benefits of PERFECT COMPETITION mar- C. positive economic profit
ket structure are D. negative economic profit
A. prices are kept low E. negative accounting profit
B. consumer power/sovereignty
1251. Coke and Pepsi are the main producers
C. allocative & productive efficiency and control the soda market. This is an
D. minimum AC & LRAC example of:
A. Oligopoly
1248. In the US the market for beef is heavily
regulated and all most all beef producers B. Monopoly
across the country produce beef practically C. Monopolistic Competition
identically.
1252. How will an earthquake leading to the

deaths of hundreds in a large town affect
food supply from neighbouring towns?
A. it will increase supply
B. it will reduce supply
C. it will stop supply
D. it will make supply constant
1253. the expenses a new business must pay

before it can begin to produce and sell
goods
A. Start-Up Costs
A. Pure Perfect Competition B. Price War
B. Monopolistic Competition C. Barrier to Entry
C. Oligopoly D. Collusion
D. Monopoly 1254. The Sherman Act, the Clayton Act, and
1249. A system in which the government al- the Federal Trade Commission Act were all
locates goods and services using factors designed to
other than price A. ensure competition

B. promote trusts A. oligopolistic economies

C. create public goods B. market-oriented economies
D. extend mortgages C. closed market economies
1255. Sophie runs a small bakery, but is not D. none of above
good with keeping up with the business
end of things. 1258. Choose the correct option
NARAYAN CHANGDER
A. Monopoly
B. Oligopoly
A. Sole-Proprietorship C. Oligopsons
B. Partnership D. Monopsons
C. Corporation
1259. This firm will charge a price of and
D. none of above
make a per unit of
1256. refers to shares of ownership in a
corporation.
A. 70; loss; 10.

C. 70; profit; 3.5.
D. 60:profit; 10.
E. 70; profit; 10.
A. Stocks
B. Bonds 1260. Monopolies can control the price of a
product because
C. Certificates of Deposit
A. They are evil.
D. Demand Deposits
B. They are illegal.
1257. Advertising spent on differentiated
C. The have a unique product.
products for monopolistically competitive
firms is considered controversial in D. The government supports them.

1261. Which of the following is an example of A. Perfect Competition

a barrier to entry in the airplane market? B. Monopolistic Competition

A. There are not enough sellers in the C. Oligopoly
market
D. Monopoly
B. The high start-up costs and money
needed to build a factory 1265. In the 1950s in the United States, the
car industry was dominated by GM, Ford
C. Agreements among other airplane and Chrysler. This is an example of:
makers to keep prices high
A. A monopoly
D. none of above
1262. He just died in Syria while America Spec C. Perfect Competition
Ops dogs chased him down. D. An oligopoly
A. Abu Bakr al-Baghdadi
1266. The Supply Curve has moved right.
B. Scooby Yabba Dabba Doo Where is the new equilibrium price and
C. Usman bin Laden quantity?
D. Jeff A. Higher, higher
B. Lower, lower
1263. Anything that hinders a business from
entering the market C. Lower, higher
D. Higher, lower
A. Human Capital
B. Resource Labor 1267. The market structure for private
aerospace travel would most resemble a:
C. Barrier to Entry
D. none of above
B. Oligopoly
1264. The airwaves are filled with ads for C. Monopoly
different flavors of Doo-das. Each Doo-
da isessentially the same, however the
branding the different firms use has made 1268. The term for costs that cannot be
themseem different. One firm mar- avoided in the short run
kets “healthy Doo-das”, another markets A. Total Cost
“chocolatecovered Doo-das”, then there
are the “Doo-das that are just for kids!” B. Fixed Cost
When going tothe store to buy your fa- C. Average Cost
vorite flavor of Doo-da you notice that D. Variable Cost
they are all essentiallythe same price,
with very little variation between the 1269. Which is a major advantage of the cor-
brands, but some are a fewcents cheaper porate form of business?
than others and they have been that way A. The owners have an unlimited liability.
for years. On the news a fewyears back B. The company has a limited life.
they ran a piece saying, “Doo-das are
one of the easiest industries tobreak into C. Ownership is easily transferred from
with relatively few barriers to entry”How one party to another.
would you categorize the Doo-da market? D. The owners are guaranteed a profit.

1270. The image here is an example of a , C. Cartel

which causes a D. Patent
1273. Which of the following industries is an

A. Water Utilities
B. Department Stores (Debenhams, John
NARAYAN CHANGDER
Lewis, M&S)
C. Auto Industry (Ford, Vauxhall, BMW,
A. Price Ceiling:Shortage Honda, Toyota)
B. Price Ceiling:Surplus D. Airlines (BA, American Airlines, Cathay

Pacific, Easy Jet)
C. Price Floor:Shortage
D. Price Floor:Surplus 1274. Non-price competition is the use of ads,
giveaways, or promotions to win cus-
1271. Which of these companies are the most tomers
likely to participate in an oligopoly?
A. True
A. Pharmaceutical company
B. False
B. Power company
C. An apple farmer 1275. Which of the following is NOT one of the
conditions of competitive markets?
D. Frozen yogurt store
A. Many actors (consumers and produc-
1272. A federally issued document that gives ers)
an inventor the exclusive right to make,
B. Very different products
use, and sell their invention for up to 20
years is a C. Widespread information available to
consumers and producers
D. Low barriers to entry and exit of mar-
ket
1276. Market where a single seller dominates.

A. open market
B. monopoly
C. oligopoly
D. luciopoly
1277. The intended effects of advertising are

to increase the market share for a firm and
to make the demand for the product more
elastic
A. Business License A. TRUE
B. Company B. FALSE

1278. How easy is it for companies to collude? 1283. Which is an example of a natural
A. very easy monopoly?

B. somewhat easy A. a city water system
C. very difficult B. an intergovernmental revenue pay-
D. it has never happened ment
C. a balanced budget amendment
1279. Government is concerned with all of the
following practices of oligopolies EXCEPT D. all three of these
A. price leadership.
1284. Other things being equal, if the price of
B. low barriers to entry.
a good falls, the consumer surplus
C. collusion.
A. May increase, decrease, or remain un-
D. cartels. changed
1280. Which structure uses differentiation to B. Increases
make its products unique?
C. Is unchanged
D. Decreases
1285. All 4 questions are answered by gov-

ernment plans; the goods and services pro-
duced are based on what the government
says, not what the people want/need;
workers have little choice in their ca-
A. monopoly reer/job.
B. monopolistic competition A. Communism
C. oligopoly B. Socialism
D. pure / perfect competition C. Free Market
1281. What is the mode of 3, 5, 2, 1, 9, 8, 25, D. Entrepreneurship
2, 6, 66, 90, 7, and 4?
A. 90 1286. How can businesses differentiate their
products from other companies products in
B. 1
their market?
C. 2
A. Cool packaging
D. 25
B. Physical Location
1282. A set of rules or laws designed to con-
trol business behavior C. Image
A. Price Fixing D. All of the above
B. Regulation
1287. A market structure is characterized by
C. Cooperatives high barriers to entry, high start up costs
D. Deregulation and economies of scale is known as

1291. True or False-Economies of scale is a sit-

uation in which the average cost of produc-
tion falls as the firms gets larger.
A. True
B. False
1292. In which industry did the U.S. loss of

the global market share cause an increased
NARAYAN CHANGDER
share for all of its trading partners?
A. an Oligarchy
B. a Purely Competitive Market
D. a Monopoly
A. Aerospace
1288. Deadweight loss in this graph would
best be represented by area B. Communication equipment
C. Pharmaceuticals
D. Scientific instruments
1293. How many conditions are there for per-

fect competition?
A. 10
B. 4
C. 5
A. AFCH D. 8
B. FJH
1294. An agreement between members of an
C. JKL
oligopoly to set prices and production lev-
D. AFN0 els is called?
1289. A merger happens when one company A. Collusion
A. causes another company go bankrupt B. Price leadership
B. divides and forms several firms C. Competition
C. joins another company to form a single D. Scheming
firm
1295. Which type of a monopoly where a mar-
D. none of above
ket situation where the costs of production
1290. Which of the following is a source of are minimized by having a single firm pro-
monopoly power? duce the product?
A. Scarcity A. Natural Monopoly
B. Elasticity of demand B. Geographical Monopoly
C. Barriers to entry C. Technological Monopoly
D. Low Profits D. Government Monopoly

1296. What is a market structure with a single A. High start-up costs, lack of economies
firm and many buyers called? of scale, absence of legal barriers, lack of
control of essential resources, and weak

A. Monopoly
brand loyalty.
B. Oligopoly
B. Low start-up costs, lack of economies
C. Monopolistic competition of scale, absence of legal barriers, lack of
D. Perfect competition control of essential resources, and weak
brand loyalty.
1297. How are sole proprietorships and part-
nerships alike? C. High start-up costs, economies of
scale, legal barriers, control of essential
A. Contracts are needed to start the busi- resources, and strong brand loyalty.
nesses.
D. Low start-up costs, economies of
B. Owners have complete control of the scale, absence of legal barriers, lack of
business. control of essential resources, and weak
C. Owners have limited legal liability. brand loyalty.
D. The businesses are owned by one per- 1301. There is a large number of independent
son. sellers.
1298. What is commodity? A. Oligopoly
A. a product that is the same no matter B. Monopoly
who produces it, such as petroleum, note- C. Pure Competition
book paper, or milk
D. none of above
B. products that are very different
1302. Which market structure has the lowest
1299. Which of these statements describes concentration of sellers?
how economies of scale affect the market
for electrical power in a community?
A. Because it would cost much more for
two companies to offer power within a C. Oligopoly
community, there is usually only one. D. Monopoly
B. Because putting up long-distance
power lines is expensive, power plants 1303. Two or more individuals own and oper-
are commonly built close to each commu- ate this type for business for their own
nity. profit
C. Because large communities are A. Sole proprietorship

cheaper to supply with power than small B. Partnership
towns, small communities typically lack C. Corporation
service.
D. none of above
D. Because big power plants produce
more power than small ones, a community 1304. The market for corn in Iowa would be
near the plants risks serious air pollution. considered
1300. What are the barriers to entry in a A. Monopolistic Competition

monopoly market? B. Monopoly

C. Perfect Competition D. Monopoly is a market structure with

D. Oligopoly one seller, while perfect competition has
many sellers. tagsSSEMI3
1305. Why do firms use marketing?
1309. Jane and Jill run a photography business
A. Convince customers that their prod- as a partnership. They are trying to decide
ucts are worth the price. if they wish to form a corporation. If they
B. Influence a consumer’s buying deci- decide to incorporate, what will be a new
sion. disadvantage they will face?
NARAYAN CHANGDER
C. Persuade buyers that their products is A. Ease of startup
superior than others. B. Double taxation
D. All of these. C. Unlimited liability
1306. studies the national economy and D. Sharing of profits
global economy. In this area, we look at 1310. What are the features of monopolistic
unemployment rates, taxes, and inflation competition?
and how those impact the economy as a
whole. A. Homogeneous products, no control
over price, difficult entry and exit, price
A. Microeconomics competition
B. Socialism B. Differentiated products, no control
C. Communism over price, easy entry and exit, price com-
petition
D. Macroeconomics
C. Homogeneous products, some control
1307. What is the term used to describe a over price, easy entry and exit, non-price
situation where common goods are mis- competition
used and exploited to further business in-
D. Differentiated products, some control
terests?
over price, easy entry and exit, non-price
A. Fracking competition
B. Tragedy of the Commons 1311. Collusion most frequently occurs in in-
C. Nash equilibrium dustries that are
D. Poaching A. oligopolistic
B. monopolistically competitive
1308. What is the difference between a
monopoly and a perfect competition? C. monopolistic
A. Monopoly is a market structure with D. perfectly competitive
many sellers, while perfect competition
1312. is when there are numerous buyers
has one seller.
and sellers and no one has control over the
B. Monopoly is a market structure with price of the product.
no sellers, while perfect competition has A. Monopoly
many sellers.
B. Oligopoly
C. Monopoly is a market structure with
one seller, while perfect competition has C. Perfect Competition
no sellers. D. Collusion

1313. This market has some 25-75 firms sell- competition, firms produce slightly differ-
ing slightly differentiated products, some ent goods.
price control, & low barriers to entry

C. Perfect competition has barriers to en-
A. Oligopoly try while monopolistic competition does
B. Monopoly not
C. Monopolistic Competition D. none of above
D. none of above 1318. A document which included the name,

objectives, powers and registered address
1314. This is an illegal grouping of companies of a corporation is called
that discourages competition.
A. By-laws of corporation
A. trust
B. Constitution of Corportation
B. merger
C. Articies of Incorporation
C. Microsoft
D. Articles of Parnership
D. ween
1319. What is a demerit good?
1315. The selllers in which market are price
makers? A. A good or service that can bring about
a positive or negative externality
A. Pure/Perfect Competition
B. A good or service that has a negative
B. Oligopoly impact on the user, and a third party
C. Monopoly C. A good or service that is prohibited or
D. Monopolistic Competition regulated by the government
D. A good or service that as a negative im-
1316. Let it happen
pact on the economy
A. An economic theory that promotes gov-
ernment control of the economy. 1320. Which of the following is true regarding
legal monopolies?
B. An economic theory that supports a
mixed economy. A. They were created to stop innovation.
C. An economic theory that advocates for B. They form due to natural barriers of en-
complete government control of the econ- try.
omy. C. Government allows barriers to entry
D. An economic theory that advocates for limit competition
minimal government intervention in the D. none of above
economy.
1321. A common disadvantage of a sole pro-
1317. What is the difference between perfect prietorship is
A. Difficulty starting the business
A. Perfect competition has no barriers
to entry, while monopolistic competition B. The limited life of the business
does. C. That the owner must share profits with
B. In perfect competition, firms produce others
identical goods, while in monopolistic D. double taxation of earnings

1322. A game theorist’s advice would be B. always dependent on government pric-

A. competing to get what you want ing laws
B. collaborating to get what you want C. always whatever every other firm’s
price is
C. the best strategy does not exist
D. never really a factor in a consumer’s
D. trust your gut feelings
buying decision
1323. What is a key feature of monopolistic
1327. How do monopolies maximize profits?
NARAYAN CHANGDER
competition?
A. High barriers to entry
B. Differentiated products
C. Identical products
D. Government regulation
1324. A is a business that is owned by

one individual, who makes all business de-
cisions, receives all the profits or takes all
the losses of the firm, and is legally re- A. They equate marginal cost with
sponsible for the debts of the firm. marginal revenue.
B. They keep marginal revenue above
marginal cost.
C. They keep marginal cost above
marginal revenue.
D. They control marginal costs and
marginal revenue.
1328. Which of the following is a condition of

A. General Partnership a perfect/pure competition?
B. Monopolistic Competition A. There are few sellers who are perfect.

C. Sole Proprietorship B. The products have to be very high qual-
ity
D. Corporation
C. There are perfect rules that are en-
1325. In the circular flow model, which of the forced by the government
following owns the factors of production?
D. Products must be exactly the same
A. government
B. only households 1329. under perfect competition what sets the
C. only businesses equilibrium price in the market?
D. both businesses and households A. nonprice competition

B. supply and demand
1326. The product price of a firm in a perfectly
competitive industry is C. the government
A. never more than $100 each D. a monopoly

1330. The act of obtaining special treatment B. Manager’s salary

by the government to create economic C. Employee wages
profit is called

D. Pizza dough
Explanation:Pepperoni and pizza dough
will vary depending on how many pizzas
are made.Employee wages will vary on
how busy the business is. The pizza
restaurant will employ more or fewer
employees depending on sales levels.The
manager’s salary will remain constant.
A. productive efficieny. 1334. Grace, Zoe, and Benjamin are starting
B. socially optimal provision. their own businesses. Grace is starting
a monopoly, Zoe is starting an oligopoly,
C. public profit maximization.
and Benjamin is starting a business with
D. rent seeking. differentiated products. Which market
structure is Benjamin’s business character-
1331. In return for a fee to a franchiser, a busi-
ized by?
ness owner receives the right
A. Monopoly
A. to form a partnership with the fran-
chiser. B. Oligopoly
B. to sell the franchiser’s goods and ser- C. Monopolistic Competition
vices. D. Pure Competition
C. to run the business in the way he or
1335. If the government imposes a price ceil-
she wishes.
ing at P3, which area would represent con-
D. to sell the franchiser’s stocks and sumer surplus?
bonds.
1332. Car producers are an example of
A. a, b, c
A. monopoly B. a, b, c, d, e
B. oligopoly C. a, b, d
C. monopolistic competition D. f
D. pure / perfect competition
1336. SSEMI3 Which business organization
1333. Which of the following is most likely an has the disadvantage of unlimited liability
example of a fixed cost in making pizzas? for a single individual?
A. Pepperoni A. Sole Proprietorship

B. Corporation D. The average variable cost of the firm

C. Partnership will increase
D. Oligopoly 1342. A monopoly based on the absence of

other sellers in a certain location is called
1337. If Google and McDonalds were to merge
together, what type of merger would this A. an oligopoly
be? B. a natural monopoly
A. vertical
NARAYAN CHANGDER
C. a geographic monopoly
B. horizonal
1338. Most are illegal due to the Clayton and
Sherman Antitrust acts 1343. At price of $2, this firm would produce
B. Monopolistic comeptition
C. Oligopoly
D. Monopoly
1339. A market for a good or service where

there is only one supplier, or that is domi-
nated by one supplier.
A. Monopoly
B. Oligopoly A. 6
C. Perfect Competition B. 2.5
D. Monopolistic Competition C. 0
1340. A market structure in which many com- D. 4
panies sell products that are similar but
not identical 1344. Which business organization type has
double taxation?
A. Corporation
B. pure competition
C. oligopoly
D. monopoly C. Partnership
D. Non-profit
1341. In monopolistic competition if firms are
making abnormal profit other firms will en- 1345. In which economic system do both busi-
ter and: nesses and the government answer the
A. The marginal cost of the firm will shift three economic questions?
outwards A. Command Economy
B. The demand curve for the firm will shift
B. Market Economy
inwards
C. Mixed Economy
C. The average cost of the firm will shift
downwards D. Traditional Economy

1346. An agreement among members of an B. MR(3) = $10; MR(4) = $10

oligopoly to set prices and production lev- C. MR(3) = $6; MR(4) = $6
els is called

D. MR(3) =-$2; MR(4) =-$2
A. price leadership
E. MR(3) = $14; MR(4) = $12
B. competition
C. collusion 1350. Economists believe that the downside of
a minimum wage is
D. imperfect monopoly
A. A shortage
1347. What is meant by Barrier to entry?
B. Unemployment
A. new firms are welcome into the mar-
ket C. Not enough workers
B. it is easy to get into the market D. Wages will be too low
C. any factor that makes it difficult for a 1351. What is the relationship between price
new firm to enter a market and quantity demanded in a monopolistic
D. none of above competition market?
A. random
1348. When trying to start a business and en-
ter a certain product market, there are B. no relationship
fees and licenses to apply for and equip- C. direct or positive
ment to purchase. These are all
D. inverse or negative
A. consumer products
B. factors of production 1352. The high cost of starting a business
could be an example of
C. barriers to entry
A. Barriers to entry
D. supply & demand
B. Variety of goods
1349. The price and total revenue for the C. Advertising
monopoly firm Mammoth, Inc. based on
the quantity it sells is shown in this ta- D. Control over prices
ble:What is the marginal revenue (MR) for
1353. In which market structure do firms have
the third unit and the forth unit?
some control over the price of their prod-
ucts due to product differentiation?
C. Oligopoly
D. Monopoly
1354. Polaroid has a patent on instant cam-

eral, this patent means that
A. no other company can make instant
cameras
A. MR(3) = $10; MR(4) = $6 B. no other company can make cameras

C. other companies can make cameras 1359. Who is the demander is the labor mar-
but not under the name polaroid ket?
D. other companies can make instant A. Consumers
cameras but must use a different name B. Workers
1355. There are very high fixed costs involved C. Companies
in producing whatnots and over time one D. none of above
firm has come to dominate the market.
There in almost no variety in the quality 1360. The post office or fire department is an
NARAYAN CHANGDER
or appearance of the whatnots, but con- example of a monopoly.
sumers continue to purchase them because A. Technological
they are vital to a life of comfort and hap- B. Government
piness. Thankfully the government has
stepped in to ensure that the price of what- C. Geographic
nots is low and that no other firm can dis- D. Natural
rupt the production.How would you cate-
gorize the market for whatnots?
by a few large firms dominating the mar-
A. Perfect Competition ket?
B. Monopolistic Competition A. Perfect competition
C. Oligopoly B. Monopoly
D. Monopoly C. Oligopoly
1356. In monopolistic competition, each firm D. Monopolistic competition
supply a small part of the market. This 1362. Market where a few large sellers con-
occurs because trol production of a good or service.
A. there are barriers to entry A. Monopoly
B. there are no barriers to entry B. Oligopoly
C. there are a large number of firms C. Perfect Competition
D. firms produce differentiated goods D. Monopolistic Competition
1357. A 1363. Loganville has 3 main grocery stores,
A. B this is an example of which market?
B. C A. perfect competition
C. D B. monopoly
D. none of above C. monopolistic competition
D. oligopoly
1358. Formal organization of sellers that
agree to act together to set prices and limit 1364. Which market structure has the MOST
output competition?
A. Monopoly A. oligopoly
B. Price maker B. monopoly
C. Oligopoly C. perfect competition
D. Cartel D. monopolistic competition

1365. Why are cartels nonbinding in the B. Monopolistic Competition

U.S.A.? C. Perfect Competition

A. They’re illegal D. Oligopoly
B. They’re dangerous
1370. Ordering market structures according to
C. They’re not used the ease of entry for new firms from easy
D. They’re too competitive entry to more difficult entry, we have
A. monopoly, oligopoly, monopolistic
1366. Which of the following is NOT a feature
competition, perfect competition
of monopolistic competition?
B. perfect competition, oligopoly, monop-
A. Identical products
olistic competition, monopoly
B. Numerous buyers
C. perfect competition, oligopoly, monop-
C. Product differentiation olistic competition, natural monopoly
D. Numerous sellers D. perfect competition, oligopoly,
monopoly, monopolistic competition
1367. How does a monopoly affect consumer
choice and competition? E. perfect competition, monopolistic com-
petition, oligopoly, monopoly
A. restricts consumer choice and reduces
competition. 1371. Which market structure can differenti-
B. increases consumer choice and en- ate its products in order to slightly change
courages competition. its prices?
C. no effect on consumer choice and com- A. monopoly

petition. B. monopolistic competition
D. restricts consumer choice and pro- C. perfect competition
motes competition. tagsSSEMI3 D. oligopoly
1368. A market failure occurs when 1372. If ABM firm sells its differentiated prod-
A. a particular industry fails to make an ucts in a market, with many sellers and
adequate profit in a given year. buyers, the structure is a/an
B. a single company does not supply A. monopolist
more than 90 percent of the total output B. oligopolist
for a good or service.
C. perfect competitor
C. goods and services are not allocated
in the most efficient way.
D. the economy experiences a prolonged 1373. What is wage discrimination
downturn and unemployment is extremely A. Setting a wage that employers can’t go
high below
1369. Trinidad and Tobago Cement Limited con- B. When unions negotiate for higher
trols about 80% of the cement industry wages
and used to be the ONLY provider of ce- C. Paying someone differently based on
ment. This is an example of their race or gender
A. A monopoly D. Unemployment

1374. Which is a difference in how economic B. The ability of a firm or a group of firms
decisions are made in a mixed economy to collaborate with competitors in a mar-
and a market economy? ket.
A. Consumers make all economic deci- C. The ability of a firm or a group of firms
sions in a mixed economy, while govern- to attract customers in a market.
ment makes all economic decisions in a
D. The ability of a firm or a group of firms
marketeconomy
to influence the price and output in a mar-
B. Government makes all economic de- ket.
NARAYAN CHANGDER
cisions in a mixed economy, while con-
sumers make all economic decisions in a 1378. A is a maximum price sellers are al-
marketeconomy lowed to charge for a good. It’s an upper
limit for the price.
C. Government and consumers make eco-
nomic decisions in a mixed economy, A. equilibrium
while consumers make economic deci- B. shortage
sions ina market economy
C. surplus
D. Consumers make economic decisions
in a mixed economy, while consumers and D. price controls
government make economic decisions ina E. price ceiling
market economy
1379. What is the driving force in perfect com-
1375. Jackson, Hannah, and James are dis- petition
cussing the local farmers market. They
agree that the primary characteristic of A. Prices
this market, which is a purely competitive B. Collusion
market, is what?
C. Differentiation
A. Efficiency
D. Products
B. Control over price
1380. Which market structure has no barriers
C. Differentiated products
to entry or exit and all firms are price tak-
D. Barriers to entry ers?
1376. What is Price Discrimination? A. Perfect Competition
A. grouping customers together based on B. Monopolistic Competition
their wants C. Oligopoly
B. division of customers into groups D. Monopoly
based on how much they will pay for a
good 1381. Government sometimes intervenes with
C. charging everyone the same price for price controls. What the two forms of
goods price controls?
D. none of above A. Surplus and Shortage
B. Equilibrium and Elasticity
1377. What is market power?
A. The ability of a firm or a group of firms C. Price Floors and Price Ceilings
to minimize costs in a market. D. Land and Taxes

1382. At the price of 1.00 there is a

A. no; can
A. shortage of 200 B. high; can
B. surplus of 200 C. sometimes; can sometimes
C. shortage of 400 D. high; cannot
D. surplus of 400 E. no; cannot
1383. In which market structure is there the 1387. Public or Private?
MOST competition? (Think agricultural
products)
A. Monopoly
B. Oligopoly
1384. Market structure where there are many

sellers with similar products. They adver- A. Public
tise and compete to sell their products, and
B. Private
there are low barriers to entry.
A. Monopoly 1388. Which market structure has a large num-
B. Oligopoly ber of producers with identical products?
C. Monopolistic Competition A. Perfect competition

D. Perfect competition B. Monopolistic competition
C. Oligopoly
1385. The Demand Curve has moved left.
Where is the new equilibrium price and D. Monopoly
quantity?
1389. If the price is in between ATC and AVC,
A. Higher, higher
a perfectly competitive firm will:
B. Lower, lower
A. make a loss in the short run
C. Lower, higher
B. make a profit in the short run
D. Higher, lower
C. shutdown immediately
1386. In perfect competition, there are
D. achieve productive efficiency
barriers to entry and so firms in it earn
an economic profit in the long run. E. Not enough information is given

1390. What is the equilibrium price for hot 1395. Advantages of this business type are
dogs? that the owner is their own boss and gets
A. $2 to keep all the profits.
B. $3 A. Partnership
C. $4.50 B. Corporation
D. $5 C. Sole Proprietorship
1391. Under pure competition, products are D. Franchise
NARAYAN CHANGDER
A. always cheap 1396. True or False:Firms in monopolistic com-
B. differentiated petition must take the reaction of other
C. accurately priced firms into account when deciding on price
D. identical A. True
B. False
1392. Businesses conspiring among them-
selves to set the prices of competing prod- 1397. What does limited life mean?
ucts at a higher level
A. The business lives or dies with the
A. Price fixing owner(s)
B. Trust B. The business can only stay open for a
C. Market sharing limited amount of time
D. Oligopoly C. The business will only be popular for
so long
1393. If Nike and Adidas merge, it would be a
merger D. There is a limited amount of health re-
A. horizontal maining
B. vertical 1398. All of the following are reasons compe-

C. insane tition are desirable, EXCEPT
D. ladder A. It brings items to an equilibrium price.
1394. This illustrates a shift in , which B. Producers stop innovating.

could be a result of C. Producers try to differentiate their
products to meet the desires of con-
sumers.
D. Consumers have choice and can find
the best use of the scarse resource of
money.
1399. The breakfast cereal industry would be

an example of
A. Demand, Input cost increasing A. perfect competition
B. Supply, input cost decreasing B. monopoly
C. Demand, input cost decreasing C. monopolistic competition
D. Supply, input cost increasing D. oligopoly

1400. This represents part ownership in a cor-

poration

A. A share of stock
B. An article of partnership
C. A bucket full of money
A. monopoly
1401. which item being sold would be consid-
ered perfect competition B. monopolistic competition
A. bananas C. oligopoly
B. shoes D. perfect competition
C. cars 1405. Which diagram shows the short-run

D. cereal marginal cost (MC) of providing a service
where the total costs of production in the
1402. What is the defining characteristic of a short run are fixed?
perfect competition market structure?
A. A large number of firms and con-
sumers
B. A single producer of a particular com-
modity A. A
C. Firms have perfect knowledge of the B. B
market C. C
D. Consumers are price takers D. D
1403. You are supposed to go to the movies 1406. a proportionate saving in costs gained
with your friends tonight. Earlier today, by an increased level of production.
you bought a pair of shorts with your last
$30. What is the opportunity cost? A. economies of scale
A. the difference between how much a B. warehouse markets

movie ticket costs and how much the C. increased utility
shorts cost.
D. none of above
B. the $30 that you gave the paid for the
shorts. 1407. The US Gov’t passed “antitrust” laws
in an effort to eliminate the ability for busi-
C. the movie with your friends that you
nesses to
now cannot afford
A. create new techonologies
D. the joy of knowing you are the first
among your friends to have this pair of B. enlarge profits
shorts.
C. become a monopoly
1404. Tap Water D. compete for market share

1408. In perfect competition, are there any 1412. For the graph shown here, what quan-
barriers to entry for new firms? tity will this firm produce and what price
A. Yes will it charge?
B. Sometimes
C. Only for large firms
D. No tagsSSEMI3
1409. Describe the four features of monopoly.
NARAYAN CHANGDER
A. Large number of firms, identical prod-
ucts, no market power, no barriers to en-
try or exit.
B. Large number of firms, product differ-
entiation, some market power, some bar- A. vomiting ; Pa
riers to entry or exit.
B. vomiting ; Sell
C. Only a few firms, product differentia-
tion, lots of market power, high barriers C. Q1 ; P1
to entry or exit. D. Q1 ; P2
D. Only one firm, no need for product E. Q1 ; P4
differentiation, total market power, ex-
tremely high barriers to entry and exit 1413. Which best describes a public good?
1410. In which market structure do businesses A. A good provided by the government
have the least control over prices? B. A good purchased by individuals
A. Monopoly
C. A good that exists only in a free market
B. Perfect Competition
D. A good that produces no externalites
C. Oligopoly
D. Monopolistic Competition 1414. Nonprice competition typically focuses
Explanation:In a perfectly competitive on four factors:physical characteristics,
market, every product is identical and service, status and image, and
buyers will only purchase at the lowest A. barriers to entry.
price.Producers represent such a small
segment of the market that they have al- B. location.
most no influence over prices or supply. C. price.
1411. A monopoly is characterized by D. collusion.
A. a large number of firms, all of which 1415. What is the defining characteristic of
have identical products a monopolistic competition market struc-
B. a large number of firms, all of which ture?
offer similar but not identical products. A. Differentiated products
C. market domination by only a few firms.
B. Homogeneous products
D. the only firm in that industry and pro-
duces a specific product with no close sub- C. Oligopoly
stitutes. D. Perfect competition

1416. Which is NOT a characteristic of perfect A. monopoly

competition? B. monopolistic competition

A. difficult entry into the market C. oligopoly
B. identical product D. pure / perfect competition
C. many sellers
1420. A firm will shutdown if the price is:
D. no control over price
A. below ATC, but above AVC
1417. It Atlanta, the market for tourist en- B. above ATC
tertainment sees competition from a few
C. below AVC
large competitors including the Zoo, World
of Coke, the Aquarium, and Sports teams. D. equal to minimum ATC
E. none of the answers
1421. In a market, total surplus is

A. Greater than the sum of consumer sur-
plus plus producer surplus
B. Equal to the consumer’s willingness to
pay plus producer’s cost
A. Pure Perfect Competition C. Equal to the total cost to sellers minus
the total value to buyers
D. Equal to producer surplus plus con-
C. Oligopoly sumer surplus
D. Monopoly
1422. is a combination of more than three
1418. Type of monopoly is based on lack of businesses that sell unrelated goods and
other available local competitors? services?
A. Natural A. Vertical Merger
B. Government B. Horizontal Merger
C. Technological C. Multinational Merger
D. Geographic D. Conglomerate
1419. There are very high barriers these two 1423. Which of the following is the reason
structures firms have little price control in a perfectly
competitive market?
A. High barriers make it difficult for firms
to enter the market.
B. Supplied products are exactly the
same, so buyers purchase where the price
is lowest.
C. Low barriers reduce profit motive, so
there are fewer sellers.
D. none of above

1424. Why is competition among restaurants 1428. Industry

in a big city an example of monopolistic
A. Manufacturing
competition?
B. Industry refers to the supply side of
A. Starting a restaurant is expensive.
the market or all producers collectively.
B. Restaurants often go out of business.
C. Business
C. All restaurants serve food, and each
D. Agriculture
restaurant is distinctive.
NARAYAN CHANGDER
D. All restaurants serve people, and one 1429. Use the following headlines to answer
restaurant serves the most people. the question below. Owned by sharehold-
ersAccess to large amounts of funds for
1425. Complete control over prices, higher expansionDisadvantages:Double taxation
than prices should be, lower (shortage) The above headlines are all examples of
and less efficient production, no competi- A. Corporation
tion, large profit!
B. Monopoly
A. Monopoly
C. Sole proprietorship
B. Oligopoly
D. Partnership
D. Perfect Competition 1430. What is a barrier to entry?
A. High Start up costs
1426. monopoly has two key features, which
are B. Strong existing brand loyalty
A. barriers to entry and no close substi- C. High customer switching costs

tutes. D. All of the above
B. franchises and barriers to entry.
1431. A new study has shown that avocados
C. barriers to entry and close substitutes. are extremely healthy. The demand for av-
D. close substitutes and no barriers to en- ocados has increased due to a change in
try. A. market size and price
1427. A market is classified as an oligopoly B. price of a substitute good

when C. price of a complementary good
A. many firms produce the same product. D. tastes, preferences, expectations
B. only one firm sells a product with no
1432. Why do oligopolistic firms choose to col-
close substitutes.
lude? Choose all options that are applica-
C. many firms produce a slightly differen- ble.
tiated product.
A. reduce uncertainty in the market
D. a few firms compete.
B. compete with each other
E. no matter how many firms are in the
C. maximise joint profits
market, a barrier blocks entry by other
firms. D. avoid price wars

1433. What competition has distinct features 1437. Which of the following statements cor-
and firms work with interdependent be- rectly identifies a difference between
havior? monopoly and monopolistic competition?

A. perfect competition A. The monopoly firm charges a markup,
but a monopolistically competitive firm
B. oligopoly
does not.
B. There are barriers to entry in
D. monopoly monopoly, but not in monopolistic com-
petition.
1434. True or False:The government can regu-
late businesses. C. There are many buyers in monopoly,
but there are only a few buyers in monop-
A. True olistic competition.
B. False D. There is only one firm in monopoly, but
there are a few firms in monopolistic com-
1435. When the price is P1, consumer surplus
petition.
is
E. The demand curve is downward slop-
ing in monopoly, but not in monopolistic
competition.
1438. Type of merger in which a business

seeks to control the manufacturing process
A. vertical
B. horizontal
C. conglomeration
A. A D. none of above
B. A + B 1439. MARKET STRUCTURE IN WHICH A
C. A + B + C LARGE NUMBER OF FIRMS PRODUCE THE
SAME PRODUCT
D. A + B + D
A. OLIGOPOLY
1436. Barry and two associates have been op- B. MONOPOLY
erating a business that is not going well.
Barry is stressed out because the company C. PERFECT COMPETITION
is over $200, 000 in debt and he knows D. MONOPOLISTIC COMPETITION
that if it goes out of business, he and his
two associates will have to pay it out of 1440. The price of steel increases, and it now
their own pockets. It sounds like Barry costs more to purchase a car. This is
and his two associates have a because auto manufacturers have had to
raise their prices to make up for the in-
A. partnership.
creased cost of production. Is this macroe-
B. corporation. conomic or microeconomic?
C. sole proprietorship. A. macroeconomic
D. stock. B. microeconomic

1441. If the government imposed an effec- 1444. When the market is controlled by one
tive price ceiling at P3, which would be business, it is called a
matched correctly? A. Capitalistic Market
B. Command Market
C. Oligopoly
D. Monopoly
NARAYAN CHANGDER
1445. antitrust laws
A. block mergers
B. encourage competition
C. break up monopolies
A. d, e, f-producer surplus; e-deadweight
loss D. combine companies
B. f-producer surplus, abc-consumer sur- 1446. the use of advertising, giveaways, or

plus other promotions designed to convince
buyers that the product is somehow
C. c, e-deadweight loss; f-producer sur-
unique or better.
plus
A. consumer choice
D. a, b, d-producer surplus; c, e-
deadweight loss B. nonprice competition
C. imperfect choice
1442. SSEMI3 b In an oligopoly, when one firm
D. product differentiation
cuts prices this can lead to a:
A. Price War 1447. Under monopoly, the degree of control
over price is:
B. Collusion
A. none
C. Monopoly B. same
D. Surplus of that good C. very considerable
1443. Phil is an expert painter and is about to D. none of the above
begin selling his paintings online. 1448. How do monopolistic competitors try to
make their products stand out?
A. They lower their prices.

A. Sole-Proprietorship
B. They use nonprice competition such as
B. Partnership advertising.
C. Corporation C. They raise their prices.
D. none of above D. They maximize profits.

1449. A single-price monopoly transfers

A. economic profit to the government.

B. consumer surplus to producers.
C. economic profit to consumers.
D. producer surplus to consumers.
E. economic profit to deadweight loss.
1450. In a Perfect Competition, the biggest A. 7; loss; 1.5.

factor in setting price levels is
A. supply/demand C. 7; profit; 1.5.
B. the stock market D. 5.5:loss; 1.5.
C. celebrity endorsements E. 5.5; profit; 1.5.
D. price of substitute products 1455. lipstick
1451. Their is only one supplier in this market

structure.
A. monopoly
C. oligopoly
D. pure / perfect competition A. monopoly
1452. If you live in the city of Tucson, there is
C. oligopoly
a single firm who collects trash, the city.
Which market structure is this? D. perfect competition
A. perfect competition 1456. When competing businesses divide a
market amongst themselves
B. oligopoly
A. Price fixing
C. monopoly
B. Market allocation
1453. In perfect competition, what happens to D. Joint venture
the price if a firm increases its output?
1457. What is market structure?
A. The price increases. A. how the economy is structured
B. The price fluctuates. B. the nature and degree of competition
C. The price decreases. among firms doing business in the same
industry
D. The price remains the same.
C. competitions among different indus-
1454. This firm will charge a price of and tries
make a per unit of D. it shows how the economy is leveled

1458. Which does not belong to the group of 1463. Which of the following is NOT a market
market structures? structure on the Leaving Cert course?
A. Monopoly A. Monopoly
B. Oligopoly B. Imperfect Competition
C. Perfect Competition C. Oligopoly
D. Market Competition D. Perfect Competition
NARAYAN CHANGDER
1459. What is a business owned by stockhold- 1464. This firm is experiencing what at price
ers/investors but operated by others? C
A. corporation
B. sole proprietorship
1460. A monopolistically competitive firm ad-

vertises in order to:
A. shift the demand curve for its product
to the left
B. make its product more similar to its
competitors’ A. normal profit.
C. reduce the industry’ s barriers to entry B. economic profit.
D. make the demand for its product less C. economic loss.
price elastic D. shutdown.
1461. What is the main difference between
1465. a formal organization of producers that
monopolistic competition and perfect com-
agree to coordinate prices and production
petition in terms of product differentia-
tion? A. Cartel
A. Product differentiation B. oligopoly
B. Advertising differentiation C. monopoly
C. Price differentiation D. collusion
D. Location differentiation
1466. How does the government operate in a
1462. What is monopolisitc competition? free enterprise economy?
A. one company selling identical products A. It takes a hands-off approach to busi-
under different names ness
B. many companies selling similar but not B. It tells business, what to produce and
identical products what to sell
C. a very few companies selling identical C. It interferes with business only when
products its profitable
D. one company selling different prod- D. It establishes laws & rules to maintain
ucts under different names competition

1467. Which of the following is the best exam- C. monopoly

ple of a public good?
D. doodlewhig

A. highway system
B. shopping mall 1471. a formal organization of producers that
C. country club agree to coordinate prices and production
D. movie theater
A. Monopoly
1468. The market for happy face stickers
is perfectly competitive, and the market B. Oligopoly
price for these stickers is greater than C. Cartel
the average total cost (ATC) of a typical
firm.Which of the following is true about D. none of above
this market?
A. Firms are charging prices higher than 1472. Markets where large firms with very lit-
the marginal cost of producing stickers. tle competition can set prices for the entire
industry are referred to as
B. Firms are producing an allocatively in-
efficient quantity and firms will exit this in-
dustry.
C. Firms are earning positive economic
profits and more firms will enter this in-
dustry.
D. Firms are earning zero economic prof-
its and the market is in long-run equilib-
rium
E. Firms are producing a cost-efficient
quantity
1469. What affect do excise taxes on produc-

tion usually have on the supply curve?
A. decreases supply, supply curve shifts
left
B. increases supply, supply curve shifts
left A. Price Takers
C. decreases supply, supply curve shifts
B. Stockholders
right
D. increases supply, supply curve shifts C. Vertical Mergers
right D. Price Makers
1470. A is a product that is considered the
same no matter who sells it, ex. corn. 1473. In fishing towns or villages, the market
for fish pulls its supply from the same wa-
A. commodity ters and there are typically many fisher-
B. competition men selling the exact same fish.

1476. A market structure in which a large num-

ber of firms all produce the same prod-
uct and no single seller controls supply or
prices
A. Natural Monopoly
B. Government Monopoly
A. Pure Perfect Competition C. Oligopoly
NARAYAN CHANGDER
B. Monopolistic Competition D. Perfect Competition
C. Oligopoly 1477. How many firms are there in a
D. Monopoly monopoly?
A. 1
1474. Google controls 67% of the web search
market. The company has grown and B. 2-5
branched off into email, online maps, GPS C. Many
tracking systems, online data storage and D. none of above
mobile phones. There are competitors like
Microsoft and Yahoo, but they own just 1478. If a monopoly can perfectly price dis-
18% and 11% of the market, respec- criminate, what happens to the market?
tively. Which market structure(s) best fit A. all consumers will pay more than a
Google? competitive market
A. Perfect competition B. there is no dead weight loss
B. Monopolistic competition C. all consumers will get better deals
C. Oligopoly D. the US government will enforce its an-
D. Monopoly titrust laws
1475. The fair return point on this graph would 1479. Read the following situation to deter-
occur at point mine what the outcome would be:A new
type of television set uses 3-D images.
many stores will have large quantities of
the older style televisions. What will hap-
pen to the price of these older televisions?
A. The price will remain the same.
B. The price will rise.
C. The price will fall.
D. none of above
A. J 1480. AN exclusive right granted for an inven-

tion, which is a product or a process that
B. F
provides a new way of doing something,
C. L which could lead to Monopolies cerated.
D. G A. Copyright
E. K B. Trademark

C. Patent 1486. Where are factors of production (land,

D. none of above labor, etc) exchanged in the circular flow
model?

1481. What kind of market runs most effi-
A. Factor Market
ciently when one firm supplies all the
goods? B. Product Market
A. perfect competition C. Firms
B. monopoly D. Individuals
1487. A trust is when monopoly is broken up
D. oligopoly
in order to increase competition
1482. Your car was designed in the US but A. True
made in Europe, what type of enterprise
is this? B. False
A. Multinational Corporation 1488. When producers offer more of a good
B. General partnership as its price increases and less as its price
C. Domestic Monopoly falls, this defines the
D. Oligopoly A. law of demand
1483. An agreement among members of an B. law of supply

oligopoly to illegally set prices and produc- C. change in demand
tion
D. change in supply
A. Trust
B. Cartel 1489. ABC business is one of the few large
firms in the country. If it increases his
C. Monopoly
price, his competitors tend to If it de-
D. none of above creases his price, his competitors tend to
1484. The use of the features of a product to Hence, ABC will its price in order
differentiate the product is ? to compete.
A. store layout A. follow / follow / change

B. non price competition B. not follow / follow / change
C. price competition C. not follow / follow / maintain
D. bait and switch D. follow / not follow / maintain
1485. What type of monopoly is based on
1490. In the housing market, a NPF moves the
ownership of control of a manufacturing
demand curve right. What happens to the
method, process, or other scientific ad-
allocation of resources?
vance
A. Natural Monopoly A. Moves left
B. Geographic Monopoly B. Moves right

C. Technological Monopoly C. Increase
D. Government Monopoly D. Decrease

1491. Liam, Olivia, and Aiden are running A. Perfect Competition

their own businesses in the same indus- B. Monopolistic Competition
try. They are discussing the impact of
new businesses entering and existing busi- C. Oligopoly
nesses leaving their industry in the long D. Monopoly
run. What could be the impact of these
changes on the industry equilibrium? 1496. If there is something wrong a a food
product who is responsible for informing
A. Entry of new businesses like Liam’s the public?
NARAYAN CHANGDER
leads to a decrease in market supply
A. OSHA
B. Only the most efficient businesses like
B. FDA
Olivia’s survive and remain in the industry
C. FEMA
C. Exit of businesses like Aiden’s leads to
an increase in market supply D. NLRB
D. All of the above 1497. This market structure occurs when an in-
dustry is filled with many sellers who sell
1492. A market in which there are many buy- similar but differentiated products
uct A. Monopoly
A. Monopoly B. Oligopoly
D. Oligopoly 1498. What is perfect competition?
A. Perfect competition is a market struc-
1493. Factors that make it difficult for new
ture where there are barriers to entry and
businesses to enter a market are called (a)
exit for firms.
; which can lead to (b) competition. This is
a market structure that fails to meet the B. Perfect competition is a market struc-
conditions of pure competition. ture where products are differentiated
and have varying prices.
A. a barrier to entry
C. Perfect competition is a market struc-
B. b imperfect ture where there are only a few buyers
C. monopolistic and sellers.
D. limited resources D. Perfect competition is a market struc-
ture where there are many buyers and
1494. Levi’s jeans are part of sellers, homogeneous products, perfect
A. a monopoly information, no barriers to entry or exit,
and no individual firm has control over the
B. an oligopoly
market price. tagsSSEMI3
1499. How do products in a monopolistic com-
D. none of above petition differ from the products sold in a
1495. 5 cell phone makers control about 85% perfectly competitive market?
of the market for cell phones so they are A. the products are homogeneous or
in what market structure: idential

B. the products are similar but differenti- 1503. Brand loyalty describes the willingness
ated of consumers to buy a good at a higher
price than the price of its close substitutes

C. all products could be the leading brand
D. the products are sold by only a few sell- A. TRUE
ers B. FALSE
1500. If an industry is basically impossible for
1504. A market with very few sellers and
new firms to enter because of government
plenty buyers is called
regulation, it is probably which market
structure? A. monopoly
A. perfect competition B. duopoly
B. oligopoly C. oligopoly
C. monopoly D. monopsons
1505. A single-price monopolist is currently
1501. oligopoly is a market which has producing in the inelastic portion of its mar-
A. few large firms ket demand curve. In order to maximize
B. huge number of sellers profits, the monopolist should change the
price and quantity in which of the follow-
C. limited product to be sold ing ways?
D. firms with huge usp
A. P=Increase; Q=Increase
1502. Which of the following statements B. P=Increase; Q=Decrease
about monopolistically competitive mar-
kets is false? C. P=Decrease; Q=Decrease
A. Firms in a monopolistically competitive D. P=No Change; Q=Increase
market compete with each other in ways
besides price (they engage in non-price 1506. In which market structure do firm’s not
competition). use the marginal principle to maximize
profit?
B. Firms in a monopolistically competi-
tive market often attempt to differentiate A. monopoly
their products from their competitors with B. oligopoly
unique product attributes.
C. Monopolistically competitive firms of-
ten advertise to increase demand for their D. perfect competition
products.
1507. This is the easiest market structure to
D. Monopolistically competitive markets
enter because of low barriers to entry and
are similar to perfectly competitive mar-
the number of producers.
kets in that there are many sellers in both
market structures A. Monopoly
E. Firms in a monopolistically competi- B. Monopolistic Competition
tive market are price takers and have no
choice but to charge the same price as
their competitors D. Oligopoly

1508. What is the market supply curve for a B. Monopolistic Competition

monopoly firm? C. Perfect Competition
A. No supply curve D. Oligopoly
B. Downward sloping
1513. What letter on the graph represents the
C. Horizontal proper location for the market structure
D. Upward sloping “monopoly”?
NARAYAN CHANGDER
1509. Price takers are individuals in a market
who:
A. select a price from a wide range of al-
ternatives.
A. W
B. select the lowest price available in a
competitive market. B. Y
C. select the average of prices available C. X
in a competitive market. D. Z
D. have no ability to affect the price of a
1514. Buyers have few choices when it
good in a market.
comes down to satellite TV and internet
1510. In the circular flow model, which of the providers. Basically, the producers are
following flows in the opposite direction pretty much the same. This is an example
from the flow of factors of production and of
goods/services? A. monopoly
A. finished goods and services B. oligopoly
B. wages, rent, interest, and profit C. monopolistic competition
C. transfer payments from government D. perfect competition
D. firm’s profit incentives
1515. laws that encourage competition in the
1511. A disadvantage to a corporation is that marketplace
A. decision making is no longer controlled A. antitrust laws
by the original entrepreneur B. patent laws
B. bond holder have first claim to a corpo- C. anti-collusion laws
ration’s profits.
D. reduced impact fees
C. dividends are taxed twice, once as a
corporate income and once as personal in- 1516. There are four ways to compete without
come. changing the price of your product. Which
D. stockholders demand and get large of these is NOT a way to participate in the
dividends if any profits are made non-price competition?
A. yearly sales
1512. The market structure with the most con-
trol over prices and as a result, the highest B. physical characteristics
prices is: C. advertising
A. Monopoly D. location

1517. A market in which a single seller domi- 1521. selling a product below cost to drive
nates competitors out of the market

A. monopoly A. predatory pricing
B. natural monopoly B. price fixing
C. license C. collusion
D. market power D. price adjusting
1522. The town of Utopia has three gas sta-

1518. The degree of competition in the tions. The owners of these gas stations
OLIGOPOLY market structure is collusive make decisions together about when to
when raise and lower gas prices. It would be
A. firms compete with each other difficult for another gas station to enter
this market. Which market structure best
B. they collude to form a cartel
describes the market for gas in Utopia?
C. cooperate to determine the price A. Perfect competition
D. none of above B. Monopolistic competition
1519. This graph could represent all of the fol- C. Oligopoly
lowing except D. Monopoly
1523. A market structure in which many pro-

ducers supply an identical product. (This is
the most efficient structure)
A. Market Failure
C. Oligopoly
D. Monopoly
A. pure monopoly in the short run. 1524. Which market structure do we en-
counter most often in our daily lives?
B. pure monopoly in the long run.
C. monopolistic competition in the short
B. oligopoly
run.
D. oligopoly in the short run.
D. monopoly
E. perfect competition.
1525. The Dow Jones industrial average
1520. What is a corporation? swept past 12, 000 for the first time. In-
A. a government agency. vestors are increasingly optimistic about
corporate earnings and the economy. This
B. a legal entity that is separate and dis- achievement MOST likely involved which
tinct from its owners. type of business organization?
C. a non-profit organization. A. sole proprietorship
D. a type of partnership. tagsSSEMI3 B. partnership

C. corporation C. professional sporting event

D. conglomerate D. factory
1526. A merger happens when one company
1531. What is the main characteristic of
A. Causes another company to go out of economies of scale?
business
A. Falling average costs as production in-
B. Divides and forms several companies creases
NARAYAN CHANGDER
C. Joins another company to form a sin-
B. Increasing average costs as produc-
gle company
tion increases
D. Sells their business to another com-
pany C. No marginal costs for operation
D. Low start-up costs act as entry barri-
1527. A firm wishes to acquire some of the
ers
consumer surplus its customers currently
enjoy. How might it achieve this?
1532. An oil driller, oil refinery, and gas com-
A. by charging a price that maximises rev- pany merge this is a merger
enue
A. horizontal
B. by introducing price discrimination
B. vertical
C. by reducing operating costs
D. by taking advantage of economies of C. inappropriate
scale D. monopolistic
1528. follows these conditions:one seller; com-
plete barriers to enter market; complete 1533. Nonprice competition is most important
control of the price; no differentiated prod- in which of the following markets?
ucts A. perfect competition
A. perfect competition B. trusts
C. oligopoly
D. monopoly
D. monopoly
1529. What market form can a single firm 1534. What is meant by a “market failure”?
cause change in output, sales, and price? A. It is the government’s inability to pro-
A. Monopolistic Competition vide enough employment opportunities.
B. Perfect (Pure) Competition B. It is the natural scarcity of resources
C. Oligopoly to meet society’s needs and wants.
D. Monopoly C. It refers to the imperfections of all

market structures, except the perfectly
1530. Which of the following is an example of competitive market.
a public good?
D. It refers to the inefficient use of re-
A. shopping mall sources due to a lack of competition or the
B. highway presence of externalities.

1535. How many hot dogs will suppliers sup- 1540. Noah, Avery, and Ethan are members
ply at $2/hot dog? of a small group of companies that dom-
inate the smartphone market. They have

A. 100
been accused of illegally setting prices and
B. 200 production levels. What is this practice
C. 300 called?
D. 400 A. Collusion
1536. A group of firms combined in order to B. Price war

reduce competition in an industry C. Price fixing
A. Trust D. Cartels
B. Franchise
1541. Advantages include limited liability for
C. Oligopoly owners, unlimited life, and ease of trans-
D. Limited Partnership fer of ownership.
A. Sole Propriotorship
1537. At market equilibrium there is
B. Partnership
A. a shortage
C. Corporation
B. excess demand
D. none of above
C. the same amount of supply and de-
mand 1542. Advertising is most likely to be used in
D. a surplus which kind of market?
1538. A firm operating in a monopolistically A. Monopoly

competitive market can earn economic B. Monopolistic competition
profits in C. Perfect price discriminating monopoly
A. the short-run, but not in the long run. D. Oligopoly
B. the long-run, but not in the short run.
E. Perfect competition
C. both the short run and the long run.
1543. Which of the following may be a nega-
D. neither the short run nor the long run.
tive externality resulting from the expan-
1539. What is a monopolistic competition? sion of a local airport?
A. a market structure characterized by a A. people near the airport lose value in
large number of well-informed indepen- their house and deal with traffic
dent buyers and sellers who exchange B. There is a rise in retail in the area
identical products
C. Additional employment is needed at
B. the market structure that has all the the airport
conditions of perfect competition except
D. There is an unexpected benefit for a
for identical products
third party not involved in the expansion.
C. a market structure in which a few very
large sellers dominate the industry 1544. How many companies are there in a
D. a market structure with only one seller monopoly?
of a particular product A. 1

B. 2-5 1549. Paul goes to the clothing store to buy a

new t-shirt, for which he is willing to pay
C. Many
$10. He finds the perfect t-shirt that costs
D. none of above $10. At the register he learns it is 50%
off. Paul’s consumer surplus is:
1545. The government takes part in the US
A. $0
economy to
B. $5
A. encourage competition and fair play
NARAYAN CHANGDER
C. $10
B. reduce the effects of imperfect compe-
tition D. $15
C. regulate industries that serve the pub- 1550. What is a natural monopoly?
lic good A. A market that runs more efficient with
D. all of these are correct only a few firms.
B. A market that runs more efficiently
1546. Under which market structure can two with as many firms as possible.
firms work together to set high prices?
C. A market that runs more efficiently
A. monopoly with only one firm.
B. perfect competition D. Any market that deals with natural re-
C. monopolistic competition sources and where have many firms is still
efficient.
D. oligopoly
1551. Which market structure has the least
1547. If society does not need more than one competition in the marketplace?
company to create a product (for exam- A. Perfect Competition
ple:electric companies), this is a mon-
poly. B. Monopolistic Competition
A. natural C. Oligopoly
D. Monopoly
B. geographic
C. technological 1552. Samuel, Emma, and Grace are discussing
market power in their economics class.
D. government Can you help them understand what mar-
ket power is?
1548. In which circumstance will a firm cease
production in the short run? A. The ability of a firm or a group of firms
to influence the price and output in a mar-
A. It makes a profit that is less than its ket.
total variable costs.
B. The ability of a firm or a group of firms
B. It makes a profit that is less than its to control the supply and demand in a mar-
total fixed costs. ket.
C. Its average revenue is less than its av- C. The ability of a firm or a group of firms
erage cost. to collaborate and set prices in a market.
D. Its average revenue is less than its av- D. The ability of a firm or a group of firms
erage variable cost. to maximize profits in a market.

1553. Clothing would most closely be associ- C. General Partnerships

ated with which of the following markets?
D. Vertical Mergers

A. Monopoly
B. Perfect Competition 1557. The law of demand states that as the
price increases then
A. quantity demanded increases
D. Oligopoly
B. quantity demanded decreases
1554. This market structure is when on indus-
try is controlled by a handful of companies C. demand increases
A. Monopoly D. demand decreases
B. Oligopoly 1558. When a monopoly participates in
C. Monopolistic Competition “predatory prices” prices will go
D. Perfect Competition A. down
1555. Market in which a single seller exercises B. up
exclusive or nearly exclusive control over C. stay the same
a particular good or service.
D. none of above
A. Oligopoly
B. Natural Monopoly 1559. In which market structure is each firm’s
C. Monopoly demand perfectly elastic?
D. Natural Monopoly A. monopoly
1556. are merging firms that produce iden- B. oligopoly

tical or similar products and compete in the C. monopolistic competition
same market.
1560. What is the equation for total revenue

in a monopoly market?
A. TR = p * q
B. TR = p + q
C. TR = p / q
D. TR = p-q
1561. A product that consumers see as the

same, regardless of the producer
A. Differentiated product
B. Similar product
A. Horizontal Mergers C. Standardized product
B. Conglomerate D. none of above

1562. which of the following factors con- 1566. What is a characteristic of a monopolis-
tribute to market failure? tic market?
A. adequate competition A. Products are identical
B. knowledge of prices and opportunities B. Entry into the industry is easy
C. mobility of resources C. Producers have complete control over
price
D. inadequate competition
D. There is only one producer
NARAYAN CHANGDER
1563. A factor that makes it difficult for new 1567. The orange sellers in a Mexican mercado
firms to enter a market are in what market structure?
A. Perfect competition A. monopoly
B. Barriers to entry B. oligopoly
C. Start up costs C. monopolistic competition
D. imperfect competition D. Perfect competition
1564. What is the law in a city that desig- 1568. the market structure that exists when
nates separate areas for residency and there are many small businesses selling
business? one standardized product
A. Land area laws A. pure competition
B. Zoning laws B. imperfect competition

C. pure market
C. City ordinance law
D. monopoly
D. Industrial business license
1569. Which of the following lists shows the
1565. The business practice of selling the same types of market ordered from highest to
good at different prices to different groups lowest price?
of customers is known as
A. oligopoly, perfect competition,
monopoly
B. perfect competition, monopoly,
oligopoly
C. monopoly, oligopoly, perfect competi-
tion
D. perfect competition, oligopoly,
monopoly
E. monopoly, perfect competition,
oligopoly
1570. In oligopoly
A. Price Takers A. firms compete with each other only
by raising and lowering quantity because
B. Cartels
prices are fixed
C. Price Makers B. the fewness of firms creates mutual in-
D. Price Discrimination terdependence in pricing among the firms

C. the firm is the industry B. low start-up costs.

D. firms have no difficulty entering and C. perfect competition.

leaving the market D. government deregulation.
E. the firm having a natural monopoly 1575. In which market structure are sellers
sets price for the others mutually interdependent?
1571. A(n) monopoly is a market that runs A. monopoly
most efficiently when one large firm pro- B. perfect competition
vides that service or good.
A. natural D. oligopoly
B. government
1576. When a major car company lowers its
C. franchise prices, other car makers will probably
D. industrial A. maintain existing prices.
B. raise their prices.
1572. Ethan, Noah, and Daniel are discussing
market structures. They come across the C. go out of business.
term ‘monopoly’. What is a monopoly? D. lower their prices.
A. A monopoly is a market structure in 1577. For the firm shown in the graph above,
which a single company or entity has ex- the short-run, profit-maximizing strategy
clusive control over a particular product would be to set output at:
or service.
B. A monopoly is a market structure in
which companies have equal control over
a particular product or service.
C. A monopoly is a market structure in
which a single company has control over
multiple products or services.
D. A monopoly is a market structure in A. Q1, price at P3, and earn an economic
which multiple companies have control profit
over a particular product or service. B. Q1, price at P1, and suffer a loss
1573. If a firm in monopolistic competition is C. Q2, price at P2, and earn an economic
incurring losses in the short run, then they profit
should only shutdown entirely if which of D. Q2, price at P2, and earn only a normal
the following is true? profit
A. P < AVC 1578. Effort by a producers or sellers of a par-
B. P < ATC ticular product to secretly set production
levels or prices.
C. P < AFC
A. Patent
D. TR < AVC
B. Price War
1574. An example of a barrier to entry is C. Product Differentiation
A. high start-up costs. D. Collusion

1579. Businesses maximize profit when they B. It will fall

produce at a level where
C. stays the same
A. Total revenue = total cost
D. Unknowable
B. Marginal revenue = marginal cost
C. Total revenue > total cost 1584. Ideal market where there are a large
D. Marginal revenue < marginal cost number of sellers of identical goods and
Explanation:When total revenue = total services and in which no one seller controls
NARAYAN CHANGDER
cost, the business is at break even.When supply or prices.
total revenue is greater than total cost,
A. Monopolistic Competition
the business is profitable but not at its
maximum.When marginal revenue is less B. Oligopoly
than marginal cost, each additional sale
loses money. C. Perfect Competition
D. Natural Monopoly
1580. What is Monopolistic Competition?
A. a market that sells products that are 1585. Non-price Competition is
exactly the same
A. a market that runs most efficiently
B. a market structure in which many com-
when one large firm supplies all of the
panies sell products that are similar, but
not identical.
chaos
1581. If you want to form this type of busi- B. a formal organization of producers
ness organization, you will have to get that agree to coordinate prices and pro-
permission from a state or national gov- duction
ernment. This can be costly and require a
lawyer. C. competing on a basis other than price
A. Sole Propriotorship such as fragrance, location, color
B. Partnership D. none of above

C. Corporation
1586. What is the supply with a price floor of
D. none of above $60?
1582. Which market structure does Game The-
ory apply to?
A. Monopoly
B. Oligopoly
C. Pure Competition
1583. When a market has more competition A. 50

between firms in the market what will B. 100
happen to price for the product in that mar-
ket? C. 150
A. It will rise D. 200

1587. Markets like automobiles, cell phones, 1591. Which of the following is not a charac-
film production studios, and internet teristic of a monopoly?
providers are examples of which market

A. One seller
structure?
B. No substitutes
A. Monopoly
C. Control over price
B. Oligopoly
D. Control of resources
E. High barriers to entry
1592. An effective price floor must be set
1588. This monopolostic competitor must be above equilibrium, resulting in:
operating in the
A. a shortage
B. a surplus
C. limited choices
1593. What is an oligopoly?

A. a market structure characterized by a
large number of well-informed indepen-
A. red (taking loss). dent buyers and sellers who exchange
identical products
B. short run.
B. the market structure that has all the
C. long run. conditions of perfect competition except
D. intermediate length. for identical products
C. a market structure in which a few very
1589. An aggreement among firms to sell at large sellers dominate the industry
the same or similar price is known as
(illegal in the US) D. a market structure with only one seller
of a particular product
A. price gouging
1594. Market competitors are least likely to
B. price fixing
use advertising as a tool of differentia-
C. price discrimination tionin an industry structure identified as:
D. competitive pricing A. monopoly.
1590. What is the term used to describe when
a firm charges different prices to different C. monopolistic competition.
customers for the same product? D. none of above
A. price variation
1595. A barrier to entry is
B. customer segmentation
A. an economic term for economies of
C. product differentiation scale
D. price discrimination B. illegal in most markets

C. anything that prevents new firms from C. monopolistic competition

entering the market D. monopoly
D. a factor that increases competition
1599. Because firms in a purely competitive
1596. Analyze the data in the charts. Which market have to sell at equilibrium, they
impact will China’s trade have on U. S. are
trade? A. price takers
B. price searchers
NARAYAN CHANGDER
C. price givers
D. price setters
1600. The difference between a firm’s total

revenue and its total opportunity cost is
the firm’s
A. China will have no impact on U.S.

trade.
B. China will take over some U.S. trade
markets.
C. The United States will be forced to im-
port more technology.
A. marginal revenue
D. The world’s trade balance will be
B. economic profit
equalized.
C. marginal profit
1597. In the market for novels, there are thou-
D. normal profit
sands of writers in similar genres, but each
writer tries to make their books unique. 1601. A
A. B
B. C
C. D
D. none of above
A. Pure Perfect Competition 1602. Which of the following is not character-
B. Monopolistic Competition istic of a Monopolistic competition?
C. Oligopoly A. Long run price occurs where Price =
MIn ATC
D. Monopoly
B. It has a separate MR curve that is be-
1598. Which market structure has very few low the demand curve
existing in the world? C. Marginal cost is below the price
A. perfect competition D. It can earn positive profit or economic
B. oligopoly loss in the short run only

E. It is never allocatively or productively the lowest prices charged and the greatest
efficient amount of innovation?

1603. Bringing goods into the U.S. from an- A. monopoly
other country. B. monopolistic competition
A. imports C. oligopoly
B. exports D. perfect competition
C. shipment
1607. a market dominated by a few, large
D. shipout profitable firms
1604. Which type of market structures has A. perfect competition
very few producers(companies) that con-
trol the majority of the market? Hint:think
of the soda market C. oligopoly
A. perfect competition D. monopoly
1608. Which of these is NOT an example of a
C. oligopoly targeted discount?
D. monopoly A. Discounted airfare for buyers who buy
their tickets a few weeks in advance
1605. Why does no one firm dominate in a per-
fect competition? B. Manufactures who will refund part of
the price to those customers who fill a re-
bate form
C. A grocery store that cuts prices in the
dairy aisle
D. A store that gives discounts to senior
citizens on Wednesdays
1609. LARGE NUMBERS OF BUYERS AND

SELLERS, FREEDOM OF ENTRY AND EXIT,
IDENTICAL PRODUCTS, WELL INFORMED
BUYERS AND SELLERS ARE ALL CHARAC-
TERISTICS OF:
A. No firm wants to A. PERFECT COMPETITION
B. Each firm sells to different people B. MONOPOLY

C. Each firm produces so little of the total C. OLIGOPOLY
supply that they cannot influence prices D. PRICE FIXING
D. One firm will eventually dominate and
make it a monopoly 1610. A market structure in which there are
many buyers and sellers, the goods pro-
1606. In which of the following types of mar- duced are the same, and there are no bar-
kets would you, in general, expect to find riers to entry is referred to as

D. Product Differentiation
1615. Duopoly is a type of
A. perfect competitive market
A. Multinationals C. monopoly market
D. oligopoly market
NARAYAN CHANGDER
B. Oligopoly
C. Perfect Competition 1616. An obstacle that makes it difficult for
D. Monopolistic Competition new firms to enter a market
A. barrier to entry
1611. Which one of this is not a form of non-
B. hurdle
price competition?
C. unions
A. The new design of the product makes
it unique and desirable D. licence
B. A convenient location makes business 1617. A market structure in which there is only
more accessible to customers one seller is known as a
C. A high level of service brings customer A. Pure competition
satisfaction B. Oligopoly
D. Low costs can be passed as discounts C. Monopoly
to customers D. Monopolistic Competition
1612. Use the following statements to answer 1618. True or False:Monopolies can set their
this question:I. Markets that have only a own prices.
few sellers cannot be highly competitive.II.
A. True
Markets with many sellers are always per-
fectly competitive. B. False
A. I and II are true. 1619. If you had a grievance against manage-
B. I is true and II is false. ment, the least disruptive way to resolve
the issue would be to
C. II is true and I is false.
A. boycott
D. I and II are false.
B. lockout
1613. What are Start-Up Costs? C. strike
A. taxes that must be paid after selling D. collectively bargain
goods
1620. For a firm to operate at allocative effi-
B. the expenses a firm must pay before it ciency, P must be MC whereby there is
can begin to produce and sell goods of deadweight loss (market failure).
1614. Using style, service, advertising, or A. more / no presence
giveaways to create competition B. equal / presence
A. Perfect Competition C. equal / no presence
B. Nonprice Competition D. less / no presence

1621. Markets with more competition typi- C. resources

cally D. none of above

A. have lower prices
1627. Characteristics include owned by two or
B. have higher prices
more people and may be general or lim-
C. have price discrimination practices ited.
D. have price fixing practices A. corporation
1622. The goal of a company in an oligopoly B. sole proprietorship
industry is to C. partnership
A. Increase market share and profits. D. none of above
B. Obtain the highest price possible.
1628. What is economics?
C. Always follow rivals if they raise price.
A. The study of money
D. Be the market leader in innovation.
B. The study of how people choose to use
1623. In this type of business, the owner re- limited resources
ceives all the profits but also takes all the C. The study of governments and citizens
risks and suffers all the losses
D. The study of the past
B. Partnership 1629. At the price, neither a surplus or a short-
age exists; at this point the amount de-
C. Corporation manded equals the
D. none of above A. equilibrium
1624. How does the government try and pre- B. consumer surplus
vent negative externalities?
C. producer’s surplus
A. Taxation
D. dead weight
B. Subsidies
E. inefficiency
C. Shutting down those businesses
1630. Which of the following events would be
D. Putting people in jail
most likely to cause supply shock to gaso-
1625. How can you move from surplus to equi- line?
librium A. Hurricane near oil refineries
A. Raise the price B. a light rain in the middle of the Indian
B. Lower the price Ocean
C. Keep the price the same C. Snow fall on Mt Everest
D. All of the above D. Sand storm in the Sahara Desert
1626. By controlling supply, monopolies can 1631. Partnerships are the least common type
control of business organization?
A. need A. True
B. prices B. False

1632. any factor that makes it difficult for a A. Perfect Competition

new firm to enter a market B. Monopolistic comeptition
A. Barrier to Entry
C. Oligopoly
B. Start-Up Costs
D. Monopoly
C. Price War
1638. A beauty salons would be an example If
D. Collusion
who’ which type of market structure?
NARAYAN CHANGDER
1633. Which of the following Market struc- A. Oligopoly
tures has the most sellers?
D. Monopoly
C. Oligopoly
D. Monopoly 1639. Describe the four features of perfect
competition.
1634. is a market structure characterized
A. Large number of firms, identical prod-
by a very large number of buyers and
ucts, no market power, no barriers to en-
sellers of an identical product. (Exam-
try or exit.
ple:commodities like crude oil)
entiation, some market power, some bar-
B. monopsons riers to entry or exit.
C. oligopoly C. Only a few firms, product differentia-
D. monopoly tion, lots of market power, high barriers
to entry or exit.
1635. A only has one seller of a product
with no close substitutes. D. Only one firm, no need for product
A. oligopoly tremely high barriers to entry and exit
B. monopoly
C. barrier to entry which market structure?
D. scarcity
1636. Benefits that encourage people to act in

certain ways are called
A. Utility
B. Consumer
C. Efficiency
D. Incentives
1637. Technology advances quickly, all compa- B. oligopoly
nies sell at about the same price, always
have “price promotions” available to con- C. monopoly
sumers D. monopolistic competition

1641. The key thing the government does to A. free

turn any seller into a monopoly is B. rich
A. subsidize it

C. low
B. tax it more heavily D. high
C. issue patents
1647. Which of the following describes a
D. enforce anti-trust laws monopoly firm?
1642. A corporation is a legal “person.” This A. Single seller
means the corporation B. Many sellers
A. is difficult to organize. C. Many substitutes
B. can raise only limited capital. D. No barrier to entry
C. is the most common form of business
1648. If an industry has 4 firms, but is very
organization.
expensive for new firms to enter, it is
D. can sue or be sued, enter into con- probably which market structure?
tracts, and must pay taxes.
1643. a large number businesses selling sim- B. oligopoly
ilar but different products at different C. monopoly
prices
A. Monopoly
B. Oligopoly 1649. A movie theater that provides dis-
counted tickets to groups such as seniors,
C. Perfect competition students, and military personal is engag-
D. Monopolistic competition ing in
A. price discrimination.
1644. A business organization owned and con-
trolled by one person B. non-price competition.
A. Partnership C. collusion.
B. Corporation D. deregulation.
C. Sole Proprietorship 1650. Labor that is supplied to businesses by
D. Franchise households for the production of goods
and services are part of the:
1645. Liability is the
A. opportunity of the sole proprietor to-
keep all profits after taxes.
B. legal obligation to pay debts.
C. requirement to offer fringe benefits.
D. necessity to do a lot of paper work.
1646. The USA has a market, meaning we

have the right to choose what and what A. Product Market
not to buy. B. Consumer Price Index

C. Resource or Factor Market C. a license that gives the inventor of a

D. Goods Market new product the exclusive right to sell it
for a certain period of time.
1651. For the unregulated, single-price D. none of above
monopoly shown in the figure above,
when its profit is maximized, output will 1654. What is the difference between perfect
be competition and monopolistic competition?
A. Perfect competition has a large num-
NARAYAN CHANGDER
ber of small firms while monopolistic com-
petition does not.
B. In perfect competition, firms produce
identical goods, while in monopolistic
competition, firms produce slightly differ-
entgoods.
C. Perfect competition has no barriers
to entry, while monopolistic competition
A. 4 units per year and the price will be does.
$6. D. Perfect competition has barriers to en-
B. 4 units per year and the price will be try while monopolistic competition does
$4. not.
C. 6 units per year and the price will be 1655. If Chipotle is currently charging a price
$4. where its demand for burritos in inelastic,
D. None of the above answers is correct. the Chipotle’s marginal revenue is
1652. If the government sets the minimum

wage at $24
A. 0 hours will be supplied A. maximized.

B. 8 hours will be supplied B. negative.
C. 12 hours will be supplied C. zero.
D. 4 hours will be supplied D. undefined.
1653. What is a Patent? E. positive.
A. an agreement to share the invention of 1656. What kind of market runs most effi-
a product with others ciently when one large firm supplies all of
B. money shared with stockholders the output?
based on the sell of a product A. a natural monopoly

B. a network C. Monopolistic competition is a market

C. perfect competition structure in which there are many firms
selling differentiated products.

D. Monopolistic competition is a market
1657. True or False:In perfect competition, the structure in which there is only one firm
equilibrium price is set by supply and de- selling a product.
mand.
1661. What are the main characteristics of
A. True oligopoly?
B. False A. Few firms, independent, high barriers
of entry
1658. Governmental Regulatory Agency in
charge of Food quality B. Few firms, interdependent, high barri-
ers of entry
A. FDA
C. Many firms, interdependent, low barri-
B. EPA ers of entry
C. CPA D. Many firm, independent, low barriers
D. SEC of entry
1659. refers to privileges granted by a 1662. Which of the following is not monopolis-
company or government to sell a product tic competition?
or service under specified conditions. A. grocery stores
B. clothing stores
C. restaurants
D. cell phone providers
1663. market dominated by a single seller

C. oligopoly
D. monopoly
A. Oligopoly
B. Franchise 1664. This business organization has to pay
fees and royalties to the parent company.
C. Limited Partnership
D. Natural Monopoly
B. corporation
1660. What is monopolistic competition? C. partnership
A. Monopolistic competition is a market D. franchise
structure in which there are many firms
selling identical products. 1665. High barriers to entry means less than 5
B. Monopolistic competition is a market or fewer businesses control 70% or more
structure in which there are few firms sell- market share.
ing identical products. A. perfect competition

B. monopolistic competition 1670. Price ceilings lead to and price floors

C. oligopoly lead to
D. monopoly A. surplus;shortage
B. shortage;surplus
1666. A market structure with a small num-
ber of firms whose behaviors is interde- 1671. Monopolies are able to control prices be-
pendent cause they have
NARAYAN CHANGDER
A. Monopoly A. much competition and there are many
B. Oligopoly substitutes for their products
C. Monopolistic Competition B. much competition and there are no
D. Perfect Competition close substitutes for their products
E. Barriers to entry C. no competition and there are no close

substitutes for their products
1667. What does it mean when a firm engages D. none of above
in market differentiation?
A. it seeks a government contract to have 1672. NPF-Stan & Netflix drops its monthly
the sole right to provide a good or service fee by 50%. What curve is impacted in
in an area. the cinema market and how?
B. It makes agreements with other firms A. Demand Left
about production levels.
B. Demand Right
C. It seeks to distinguish its good or ser-
C. Supply Left
vices from those of other firms.
D. It sets a price for its product and ex- D. Supply Right
pects smaller firms to price their products
1673. The demand for a perfectly competitive
accordingly.
firm’s product is
1668. Which market structure is characterized A. elastic
by many farmers producing identical agri-
cultural products? B. inelastic
A. Perfect Competition C. perfectly elastic

B. Monopolistic Competition D. perfectly inelastic
C. Oligopoly E. unit elastic
D. Monopoly
1674. This market structure occurs when an
1669. The demand curve for PERFECT COMPE- entire industry is controlled by one com-
TITION is pany
A. perfectly inelastic A. Monopoly

B. perfectly elastic B. Oligopoly
C. elastic C. Monopolistic Competition
D. inelastic D. Perfect Competition

1675. Profit max would occur at price and 1679. Which market structure is characterized
quantity by a large number of buyers and sellers,
homogeneous products, and perfect infor-

mation?
A. monopoly
B. perfect competition
C. oligopoly
1680. Which of the following indicators is
most appropriate in predicting a turning-
A. B; M point in the economy?
B. J; Q A. The Industrial Production Index
C. B:N B. The average bank prime lending rate
D. A; M C. Average weekly hours, manufacturing
E. B; Q
D. none of above
1676. Scottish economist who wrote the
Wealth of Nations a precursor to modern 1681. the government does not try to elimi-
Capitalism nate all monopolies. Why?
A. Adam Smith A. it would be impossible
B. Joseph Stalin B. not all monopolies are bad

C. the government itself is a monopoly
C. Karl Marx
D. the aren’t any monopolies anymore
D. none of above
1682. Which of the following is the least com-
1677. SSEMI3 b This is a market structure petitive market structure?
with a large number of buyers and sellers
of products that are similar but can be dif- A. pure oligopoly.
ferentiated by brand, quality, etc. B. monopoly.
A. Perfect Competition C. differentiated oligopoly.
B. Monopolistic Competition D. monopolistic competition.
C. Oligopoly 1683. Few sellers=
D. Monopoly A. monopoly
1678. Which of these was the winner of the B. oligopoly

monopoly of the year in the article we read 1684. Microsoft, Sony, and Nintendo would be
in class? examples what of market structure?
A. NAACP A. Monopoly
B. NCIS B. Perfect competition
C. NCAA C. Oligopoly
D. NFL D. Monopolistic competition

1685. Positive and negative externalities are C. Perfect (Pure) Competition

called market failures because D. Oligopoly
A. they cause imperfect competition
B. they lead to higher prices
A. A law established by the government
C. their cost and benefits are not re- to protect new industries.
flected in the prices paid by buys and re-
B. A commitment on the part of big busi-
ceived by sellers
ness to allow smaller companies to com-
NARAYAN CHANGDER
D. they provide public goods pete.
1686. NPF-Consumer Confidence bounces back C. An obstacle that makes it difficult for
strongly. What curve is impacted in the TV new firms to enter a market.
market and how? D. none of above
A. Demand Left
1690. A shortage of a particular good is often
B. Demand Right a signal for a producer to
C. Supply Left A. lower the production of that good.
D. Supply Right B. raise the prices of that good
C. lower the prices of that good.
1687. which of the following do economists
use to classify markets? D. shift production to another good.
A. number of firms 1691. actually differentiating the market of-
B. size of firms fering to create superior customer value
C. type of product A. Differentiation
D. all of these B. advertising
C. trademarking
1688. A is an example of when the govern-
ment either owns and runs the business or D. sales and value tactics
authorizes only one producer; examples in- 1692. In the short run firms in perfect compe-
clude patents, franchises, and licenses. tition will still produce provided:
A. The price covers average variable cost
B. The price covers variable costs
C. The price covers average fixed cost
D. The price covers fixed costs
1693. Examples of Monopoly market?i) JP-

Sii) Googleiii) Facebook iv) National Water
Commission v ) KFC
A. i, ii, iii & iv
B. ii, iii & v
A. Government Monopoly C. and & c
B. Economies of Scale D. All of the above

1694. If a price floor was set at 320, what 1699. Zoe’s Bakery determines that P ATC and
quantity would be purchased? P AVC. Zoe should:

A. 20
B. 40 A. continue to operate even though she is
taking an economic loss.
C. 60
B. continue to operate, as she is making
D. 80
an economic profit.
1695. All buyers and sellers have sufficient in- C. shut down immediately, as she is tak-
formation to maximize self-interest. ing an economic loss.
A. Perfect Competition D. raise the price until she has maximized
B. Pure Monopoly her profits.
1700. A price ceiling will result in a
D. Oligopoly
A. shortage
1696. Price discrimination is not possible un- B. surplus
der
C. equilibrium price
D. equilibrium quantity
B. Monopoly
C. Oligopoly 1701. Coke and Pepsi heavily dominate the
soda market and rarely advertise their
prices.
1697. Allows each member of society to make
choices about how to use their resources
A. Security
B. efficiency
C. Freedom
D. Satbiility
1698. A government license to profit from

your invention.
A. patent A. Pure Perfect Competition
B. copyright B. Monopolistic Competition
C. tool C. Oligopoly
D. binky D. Monopoly

1702. Describe the role of a monopolist in set- 1706. What is it called when the government
ting prices. creates a law or restriction?
A. A monopolist sets prices based on the A. Regulation
cost of production B. Deregulation
B. A monopolist sets prices based on
their market power and the demand for 1707. In which market structure would you
their product. find a great deal of advertising?
A. oligopoly
NARAYAN CHANGDER
C. A monopolist sets prices based on the
competition in the market B. monopoly
D. A monopolist sets prices based on the C. monopolistic competition
government regulations D. perfect competition
1703. Which of the following best describes 1708. David, Nora, and Scarlett are participat-
what will happen in the long run if many ing in a market simulation game. In which
firms in a perfectly competitive market are market structure of the game would they
earning short-run positive economic prof- have clear incentives to gather as much in-
its? formation as possible?
A. Firms’ costs will decrease, causing A. Monopoly
their economic profits to increase
B. Oligopoly
B. Firms will enter the industry, causing
market demand to increase C. Monopolistic Competition
C. Firms will go out of business, causing D. Pure Competition

market demand to decrease 1709. In this market, sellers have the most
D. Firms will enter the industry, causing control over price
market supply to increase A. Perfect competition
E. Firms will go out of business, causing B. Monopolistic competition
market supply to decrease
C. Oligopoly
1704. Why is price-fixing illegal in the United D. Monopoly
State?
1710. A monopoly is a market with
A. It is unethical.
A. many suppliers
B. It restrains trade.
B. no barriers to entry
C. It leads to a monopoly.
C. many substitutes
D. It creates unnaturally high tariffs.
D. one supplier
1705. This type of monopoly encourages the
granting of patents 1711. Which of the following explains why a
city fireworks display on the Fourth of July
A. Natural Monopoly
is provided as a public good?
B. Technological Monopoly A. Fireworks displays usually take place
C. Geographic Monopoly in a public area.
D. Government Monopoly B. Fireworks are a scarce resource.

C. Nonpayers cannot be prevented from 1716. TRUE OR FALSE:In perfect (or pure) com-
seeing the fireworks. petition, sellers sell IDENTICAL products.

D. Each consumer pays a fee to see the A. True
fireworks. B. False
1712. Law of Supply = 1717. Which of the following in NOT an exam-
A. higher the price the higher quantity ple of price discrimination?
produced A. student discount
B. the smaller the quantity produced B. sales
C. the more consumers are willing to pay C. senior discounts
D. Children Fly Free
D. none of above
1718. Is the second market structure in #1 in-
1713. What are the advantages of a corpora- corporated or unincorporated?
tion as a business organization?
A. incorporated
A. Unlimited liability, inability to raise
capital, limited existence, integration of B. unincorporated
ownership and management 1719. Select the four main characteristics used
B. Limited liability, inability to raise capi- to classify markets into market structure.
tal, limited existence, integration of own- A. Type of product
ership and management
B. Number of buyers and sellers
C. Unlimited liability, ability to raise cap-
ital, limited existence, integration of own- C. Type of economy
ership and management D. Influence on price
D. Limited liability, ability to raise capital, E. Barriers to entry
perpetual existence, separation of owner-
ship and management tagsSSEMI3 1720. Which of the following is considered to
be an advantage of the corporate form of
1714. A monopoly based on the absence of business organization?
sellers in a certain location is called A. Expensive startup costs
A. an oligopoly B. low non-monetary rewards
B. Natural monopoly C. disagreement among owners
C. economies of scale D. limited liability for stockholders
D. A geographic monopoly
1721. In which market structure does a sin-
1715. With a given amount of resources, a gle firm or entity have complete market
country with a comparative advantage power and can set prices without competi-
will produce a product with- tion?
A. decreased demand A. Perfect Competition
B. lower opportunity costs B. Monopolistic Competition
C. cheaper natural resources C. Oligopoly
D. higher quality specifications D. Monopoly

1722. In this market structure, products are 1727. Which of the following companies would
similar but have some differences. These fit into the category of oligopoly?
slight differences allow producers to have
A. Safeway
some control over price.
A. Monopoly B. Walmart
B. Monopolistic Competition C. McDonalds
C. Perfect Competition D. Verizon
NARAYAN CHANGDER
D. Oligopoly
1728. In addition to making a corporation
1723. In this market, 2-24 firms control the more profitable, competitive, and efficient,
market, products can be slightly differen- merging with similar industries allows the
tiated, there are high barriers to entry, & new corporation to take advantage of
lots of control over price greater
A. Monopoly
B. Oligopoly
1724. Which scenario is an example of a

monopoly?
A. A local water company is the sole
provider of water for a small town.
A. specialized skills
B. A dry cleaner specializes in environ-
mentally friendly cleaning methods. B. extensive trained labor force
C. A farmer produces green beans for C. similar technology

sale at a farmer’s market. D. economies of scale
D. A small number of cereal companies
produce most of the cereal on the market. 1729. This pure monopolist would charge price
and make a in the run.
1725. What are the disadvantages of perfect
competition?
A. Higher prices, lack of competition, lim-
ited market efficiency
B. Higher profits, lack of government in-
tervention, limited market stability
C. Higher consumer choices, lack of price
transparency, limited market efficiency
D. Lower profits, lack of innovation, lim- A. P1; profit; long run.
ited consumer choices
B. C1; profit; long run.
1726. Is the fourth market structure in #1 in-
corporated or unincorporated? C. C1; loss; short run.
A. Incorporated D. P1; loss; long run.

B. Unincorporated E. P1; loss; short run.

1730. A price-taking firm 1735. Your uncle owns a convenience store

A. cannot influence the price of the prod- that has branches nationwide. His store
is an example of a

uct it sells
B. sets the product’s price to whatever A. business franchise
level the owner decides upon B. professional organization.
C. talks to rival firms to determine the C. multinational partnership
best price for all of them to charge
D. consumer cooperative
D. none of above
1731. Companies most likely have a well- 1736. A market structure in which only one
defined supply function when the market- producer supplies a good that is in demand
structure is: is called a
A. oligopoly. A. monopoly.
B. perfect competition. B. oligopoly.
C. monopolistic competition. C. competition.
D. none of above D. monopolistic competition.
1732. Which market structure is most similar 1737. By using , an Oligarchy market has
to perfect competition, but with product the ability to control price and distribution
differentiation? of goods/services across the market.
B. oligopoly
C. monopoly
D. duopoly
1733. Which of the following is a very difficult

market structure to get into?
C. Oligopoly A. cartels
D. Monopoly B. bribery
1734. SSEMI3 b Coca-Cola Company and Pepsi C. political influence
Company control roughly 73% of the car-
bonated (soft drink) soda market. What D. brute force
market structure would this be consid-
1738. Who is the supplier in the labor market?
ered?
A. Monopoly A. Workers
B. Oligopoly B. Producers
C. Monopolistic Competition C. Companies
D. Perfect Competition D. Factories

1739. A market structure in which a few large C. Oligopoly

firms dominate a market
D. Monopoly
A. Oligopoly
B. monopoly 1743. Unions influence the labor market
C. franchise A. through wage discrimination

D. perfect competition B. by pushing wages above equilibrium
C. by taking away jobs
NARAYAN CHANGDER
1740. Which of the following best describes
the profit-maximizing rule for a perfectly D. by setting the minimum wage
competitive firm?
1744. Which of the following is NOT consid-
A. Choose the quantity where marginal
ered a barrier to entry or exit form the
revenue equals average total cost.
market?
B. Choose the price where its marginal
revenue is highest. A. similar products
C. Choose the quantity where marginal B. patents

cost equals average total cost. C. high fixed costs
D. Choose the quantity where marginal D. proximity to natural resources
cost equals price.
E. Choose the price where average total 1745. Market failure refers to the due to
cost equals average revenue. imperfections in the market mechanism.
A. prevalence of negative externalities
1741. This firm is perfectly competitive, at a
price of $3 B. disequilibrium in the market
C. inefficient allocation of resources
D. low level of positive externalities
1746. The means of gaining business by using

factors other than price
A. Nonprice Competition
B. High Start-Up Costs
C. Rationing
A. it will make economic profit.
D. Black Market
B. it will incur economic loss.
C. it will break-even. 1747. Theoretical situation in which well-
D. it will shut down. informed, independent buyers and sellers
exchange identical products
1742. The only difference between a and A. price-fixing
a perfect competition is product differenti-
ation B. negative externality
A. Perfect Competition C. product differentiation
B. Monopolistic Competition D. perfect competition

1748. A partnership is a business organiza- 1753. How does product differentiation occur
tionowned by in monopolistic competition?

A. individuals and stockholders. A. By selling the same product as other
B. one general partner and many stock- companies
holders. B. Through branding, advertising, and
C. one or more individuals unique product features.
D. two or more individuals. C. By reducing the quality of the product
1749. Which of the following is an example of D. By lowering the price of the product
a technological monopoly?
A. Microsoft 1754. Under perfect competition,
B. Batteries A. products are similar but not identical.
1750. Cameron is an owner of a business, and B. numerous restrictions prevent firms

she has limited liability. Cameron’s busi- from entering the market.
ness must be which of the following? C. no seller can sell a product above the
A. Monopoly prevailing market price.
B. Partnership D. a single seller can affect price.
C. Corporation
D. Sole Proprietorship automobile industry?
1751. Which of the following lists shows the A. perfect competition
types of market ordered from highest to
lowest market quantity? B. monopolistic competition
A. monopoly, oligopoly, perfect competi- C. oligopoly
tion D. monopoly
B. oligopoly, perfect competition,
monopoly 1756. The Statue of Liberty was a gift from
C. perfect competition, monopoly, which country?
oligopoly A. France
D. perfect competition, oligopoly, B. Belgium
monopoly
C. Canada
E. monopoly, perfect competition,
oligopoly D. Great Britain
1752. The degree of competition in the 1757. a series of price cuts that result in un-
OLIGOPOLY market structure is non- usually low prices.
collusive when
A. price war
A. compete with each other
B. acts independently B. competition
C. determine the price, independently C. collusion

D. they frequently advertise D. price fixing

1758. Congress empowers local Firefighters

as the only life savers 911 can reach out
to.
A. Natural
B. Government
C. Technological
D. Geographic
NARAYAN CHANGDER
A. M
1759. Which of the following conditions is B. N
characteristic of a monopolistically compet-
C. Q
itive firm in long-run equilibrium?
D. R
A. P > MR and P = MC
E. Indeterminate
B. ATC = demand and MR = MC
C. P < MC and demand = ATC 1764. List the four market structures in order
from least competitive to most competi-
D. P > ATC and demand > MR tive.
A. Oligopoly, Monopoly, Perfect Competi-
1760. Why is this scenario an example of a
tion, Monopolistic Competition
monopoly? John and Mary Doe run the
only shoe repair shop in town. B. Non Competition, Oligopoly, Monopoly,
Monopolistic Competition
A. There’s alternatives in the market.
C. Monopoly, Oligopoly, Monopolistic
B. There’s no alternatives in the market Competition,
1761. A key characteristic of this market D. Monopoly, Monopolistic Competition,

structure is that there is interdependence Perfect Competition, Oligopoly
among firms. 1765. The only gas station in a small town
A. perfect (pure) competition A. Natural monopoly
B. monopolistic competition B. Government monopoly
C. oligopoly C. Technological monopoly
D. monopoly D. Geographic monopoly
1762. These make it difficult for new firms to 1766. Which type of monopoly is the least
enter a market harmful to consumers?
A. antitrust laws A. Natural monopoly

B. Government monopoly
B. cartel
C. Technological monopoly
C. barriers to entry
D. collusion
1767. Which is NOT a characteristic of a
1763. The fair return quantity is: monopoly?

A. Seller sets the market price 1772. A monopolist’s average revenue is al-
B. Entry into the market is easy ways

A. equal to marginal revenue
C. Firm sells a unique product
B. greater than the price of its product
D. One seller
C. equal to the price of its product
1768. This type of business is owned by many D. less than the price of its product
people called stockholders.
1773. What is the main goal of a corporation?
A. Minimize environmental impact
B. Partnership
B. Increase employee satisfaction
C. Corporation
C. Promote social responsibility
D. Franchise
D. Maximize shareholder value
1769. What prevents firms from entering a tagsSSEMI3
monopoly?
1774. The real or imagined differences be-
A. Barriers to Entry tween competing products in the same in-
B. Technology dustry.
C. Price A. Price competition
D. Barriers to Travel B. Product differentiation

C. Marketing differential
1770. Arrows 4 and 7 on this circular flow di-
D. Oligopoly
agram demonstrate
1775. An industry is considered an oligopoly
A. if the ten top producers together sup-
ply more than 70 percent of the total out-
put.
B. if the four top producers together sup-
ply more than 60 percent of the total out-
put.
C. if the top producer alone supplies
A. expenditures more than 50 percent of the total output.
B. finished goods and services D. if the two top producers together sup-
C. factors of production ply more than 90 percent of the total out-
put.
D. factor payments
1771. Which competition has similar products by many firms selling differentiated prod-
and use differentiation? ucts?
A. Perfect competition A. monopolistic competition
B. Oligopoly B. monopoly
C. Monopolistic Competition C. perfect competition
D. Monopoly D. oligopoly

1777. The attempt by firms to distinguish their 1781. A market structure in which a few large
goods and services from those of other firms dominate a market, with each one
firms powerful enough to influence prices and af-
A. non price competition fect competitors is known as
B. Free Rider
C. Product differentiation
NARAYAN CHANGDER
1778. “In Belarus, the country north of
Ukraine that has played a key role aiding
Russia’s attack, sanctions were applied to A. Corporate Combinations
the country’s authoritarian leader as well
as his wife, Halina. They would block B. Oligopoly
their property and interests in the United C. Pure Competition
States, and prohibit Americans from en- D. Monopolistic Competition
gaging in transactions with them.” Sanc-
tions most nearly means: 1782. which of the following is a benefit of
natural monopolies?
A. Economic penalties applied by one
country to another A. economies of scale
B. Violation of the laws of war that holds B. the Federal Trade Commission Act
people who committed them responsible C. cease and desist order
C. A reward for countries committing war D. foreclosure
crimes against their citizens
1783. The where the supply and demand
D. Global financial system that allows the curves cross
rapid transfer of money across borders
A. supply curve
1779. What is the main barrier to entry in a B. demand curve
monopoly?
C. equilibrium point
A. High barriers to entry
D. market supply
B. Moderate barriers to entry
1784. Pollution caused by automobiles is an
C. No barriers to entry example of
D. Low barriers to entry A. an innefficient allocation of resources.
1780. A short time ago the economy was B. a positive externality.
booming. Now, real GDP has declined for C. a negative externality.
the last six months and businesses are cut-
D. the public sector.
ting back their production and laying off
workers. Which part of the business cycle 1785. Low barriers to entry and takers of the
best describes these events? market price for their product
A. Peak A. perfect competition
B. Expansion B. monopolistic competition
C. Recession C. oligopoly
D. Trough D. monopoly

1786. Which of the following is NOT a type of 1791. Prie floors are always equilibrium
market structure? price.

A. Competitive monopoly A. above
B. Oligopoly B. below
C. Perfect competition C. equal to
D. none of above
D. All are types
1792. The effort by sellers to secretly set pro-
1787. The broccoli market would be an exam- duction levels or prices is called
ple of
A. collusion
B. price leadership
B. Perfect Competition C. compliance
C. Monopoly D. nonprice competition
D. Oligopoly
1793. A philosophy that government should
1788. What are the barriers to entry in imper- not interfere with commerce or trade.
fect competition? A. Competitive-price theory
A. Start-up costs, skill requirements, and B. Perfect competition theory
brand recognition C. Let it happen
B. High barriers of entry, patents/copyrights, D. Monopoly theory
and mergers
1794. What is the equilibrium condition for the
C. Economies of scale, natural monopo- output produced by a monopoly firm?
lies, and skill requirements
A. MR = MC
D. Start-up costs, skill requirements, and B. AR = MR
limited information
C. AC = MC
1789. A market structure with many compa- D. TR = TC
nies selling similar products
1795. The maximum legal price that can be
A. monopoly charged is called a
B. oligopoly A. price ceiling
C. monopolistic comp B. price floor
D. perfect comp C. price fan
D. price stair
1790. Confers the right to exclude others from
making, using, offering for sale, or selling 1796. What is a Natural Monopoly?
an invention. A. a market that runs most efficiently
A. collusion when one large firm supplies all of the
output-technology can destroy it
B. patent
B. a market the runs most efficiently
C. anti-trust
when there are a lot of firms selling the
D. natural monopoly same product

1797. Which market structures have the 1801. Which of the following is NOT a merit
largest number of firms? (pick 2) good?
A. Monopoly A. education
B. Oligopoly B. high energy drinks
C. Monopolistic Competition C. health services

D. public museums
1802. What is the only curve that continues to
NARAYAN CHANGDER
1798. When competitors cut their prices re- fall as output increases?
ally low to win business. Happens in
oligopolies and can form monopolies. A. Average Fixed Cost
B. Average Variable Cost
A. Price War
C. Average Total Cost
B. Collusion
D. Marginal Cost
C. Cartel
1803. What is a characteristic of an oligopolis-
D. Price Discrimination
tic market?
1799. What is the relationship between com- A. Producers are mutually interdepen-
petitive behaviour and competitive market dent
structure? B. Products are unique
A. Competitive behavior has no impact on C. Entry into the industry is easy
the competitive market structure. D. Producers have no market power
B. The competitive market structure de-
termines the level of competitive behav- 1804. What is the difference between a
ior. monopoly firm and a perfectly competitive
firm in terms of quantity produced and
C. Competitive behavior and competitive price?
market structure are unrelated.
A. Monopoly firm can control quantity and
D. The level of competitive behavior is di- price, while a perfectly competitive firm is
rectly related to the competitive market a price taker.
structure. B. Monopoly firm can control quantity
and price, while a perfectly competitive
1800. List the four market structures in order
firm can only control quantity.
from least competitive to most competi-
tive. C. Monopoly firm can control quantity
and price, while a perfectly competitive
A. Oligopoly, Monopoly, Perfect Competi- firm can only control price.
D. Monopoly firm can control quantity
B. Perfect Competition, Oligopoly, and price, while a perfectly competitive
Monopoly, Monopolistic Competition firm has no control over quantity or price.
1805. Isla, Aria, and James are studying about
Competition, Perfect Competition
different market structures in their eco-
D. Monopoly, Monopolistic Competition, nomics class. They are particularly inter-
Perfect Competition, Oligopoly ested in oligopolies. They are discussing

what could be the barriers to entry in an A. a seller decides to sell clothing, includ-
oligopoly. What do you think they con- ing shirts and jeans
cluded?

B. many sellers compete and none con-
A. Technological advancements and eco- trol the market price
nomic realities could be barriers C. a seller is misinformed causing him or
B. The system of government licenses her to overprice goods
and patents could be a barrier D. none of above
C. Both technological advancements and
the system of government licenses and 1810. Products that are offered are identical
patents could be barriers in
D. Economic realities and the system of A. Perfect competition

government licenses and patents could be B. Monopolistic competition
barriers C. Monopoly
1806. An advantage of a corporation is that D. Oligarchy
A. owners pay fewer taxes than other 1811. Why are there only a few firms in an
forms of business Oligopoly?
B. the business is subject to little gov reg- A. High Start-Up Costs
ulation
B. Less Control of Prices
C. owners have limited liability for debt
C. Government Regulation
D. owners have direct and immediate con-
D. Tough Working Conditions
trol of daily operations
1812. What kind of monopoly does the grant-
1807. What kind of relationship exists be-
ing of patents encourage?
tween supply and price?
A. Natural Monopoly
A. positive
B. Technological Monopoly
B. negative
C. direct
D. Geographic Monopoly
D. indirect
1813. When the quantity supplied is greater
1808. Read the following situation to answer
than the quantity demanded
the question:The yeast needed to to make
whole wheat bread rises sharply in price. A. a shortage has occurred.
What will happen to the price of whole B. a surplus has occurred.
wheat bread?
C. it doesn’t mean anything.
A. The price will rise.
D. government intervenes.
B. The price will stay the same.
1814. What type of monopoly where the costs
C. The price will fall. of production are minimized by having a
D. none of above single firm produce the product?
1809. An example of perfect competition is A. technological monopoly

when B. geographic monopoly

C. government monopoly B. K
D. natural monopoly C. Cl
1815. What is the main advantage of a part- D. Kl

nership? 1820. What is regarded as the ideal market
A. Limited liability structure?
B. Centralized decision-making A. perfect competition
NARAYAN CHANGDER
C. Higher tax rates B. monopoly
D. Shared responsibility and workload C. oligopoly
tagsSSEMI3 D. monopolistic competition
1816. Natural monopolies are actually very 1821. The characteristics of OLIGOPOLY mar-
good because ket structure are
A. they can price things lower when the A. a few large firms
market can’t
B. has standardised/differentiated prod-
B. they are not good because all monopo- ucts
lies are bad no matter what
C. has market power
C. they use all natural ingredients to
D. collusive and non-collusive
make their product
D. we all only need one of them to best 1822. is a type of business organization in
manage our resources which all partners have unlimited personal
liability and share equally in both profit
1817. The market most rarely seen in the and responsibility for the business.
world:
C. Oligopoly
D. Monopoly
1818. Mia, Aiden, and Sophia are discussing

about different market structures in their
economics class. They are trying to iden-
tify the market structure where sellers of-
fer identical products. Can you help them? A. General Partnership
A. Monopoly B. Corporation
B. Oligopoly C. Franchises
C. Monopolistic Competition D. Limited Liability Partnership
D. Pure Competition 1823. According to Lionel Robbins, what are
1819. On the Periodic Table what is the sym- means?
bol for Chlorine A. goods
A. Ch B. services

C. raw materials 1828. Agreements between duopolies are usu-

D. resources ally difficult to maintain because

A. They usually cannot agree on the quan-
1824. Which of the following describes a hori-
tity to sell
zontal merger?
A. The Pluto Motor Company merges with B. They usually cannot agree on what
Acme Tire Company price to set
B. The Sunshine Rice Cereal Company C. They usually want to charge higher
merges with New Dawn Oat Cereal Com- prices than the monopolist
pany D. Individual monopolists are often dis-
C. Futerama Video Games merges with honest
Lighting Battery Company
E. Each duopoly has a drive to control a
D. Megabux Film Studios merges with larger market share
Good Earth Food Stores
1829. Many firms selling identical product and
1825. The market for gizmos is very frag-
have no control over price.
mented, there aretens of thousands of
individual producers who eachproduce a A. Perfect Competition
small amount. The producer’s gizmos are-
generally the same in both quality and
appearance, andconsumers are indifferent C. Oligopoly
between producers’ products. Thedemand D. Monopoly
for gizmos is perfectly elastic and the firms
areconsidered “price-takers”.How would 1830. An example of monopolistic competition
you categorize the market for gizmos? where products are somewhat similar
A. monopoly
C. Oligopoly
D. Monopoly 1831. What is the most famous Christmas dish
in Poland?
1826. No choice or competition, higher prices
C. Oligopoly
D. Monopoly
1827. Which of the following is true of monop-
olies?
A. Has no rivals
A. Pork chop
B. Creates high barriers to enter the mar-
ket B. Sausages
C. Sets Price C. Carp fish
D. Allows Consumer input D. Hunter’s stew

1832. When companies that form on oligopoly B. non price competition

cooperate together to set or fix prices at C. price competition
a given level, they are engaging in
A. Monopoly
B. Vertical Integration 1838. ABC, CBS, FOX and NBC are a great ex-
ample of this market structure
C. Collusion
D. Rationing
B. Imperfect Competition
NARAYAN CHANGDER
1833. The demand curve for the MONOPOLY C. Oligopoly
market structure will be
D. Monopoly
A. inelastic
1839. This monopolostic competitor is experi-
B. perfectly elastic
encing
C. highly elastic
D. perfectly inelastic
1834. Name one characteristic of monopolistic

competition.
A. Price uniformity
D. Barriers to entry tagsSSEMI3
A. economic profit.
1835. NPF-A cyclone wrecks the Great Bar-
rier Reef. What curve is impacted in the B. normal profit.
Queensland tourism market and how? C. economic loss.
A. Demand Left D. economic shutdown.
B. Demand Right
1840. Which of the following represents a
C. Supply Left short run fixed cost for a restaurant?
D. Supply Right A. The ingredients
1836. If a company controls a specific process B. The outdoor signage
for making windows, it has a C. The employees
A. technological monopoly D. Electricity
B. natural monopoly 1841. Large firms can work together called
C. government monopoly The desire to do so is to raise prices
D. none of above which is called
A. Collusion; price fixing
1837. Competition amongst producers using
price to differentiate their product is B. Cartels; price setting
known as ? C. Teamwork; price-fixer-upper
A. product differentiation D. Oligopolies; price determination

1842. Businesses can “Collude” or work to- A. There is a rise in retail business in the
gether to set prices area.
A. Oligopoly

B. Additional employment is needed at
B. Monopoly the airport.
C. Perfect Competition C. There is an expected benefit for a third

party not directly involved in the expan-
D. none of above sion project.
1843. A business that does not have to con- D. The airport increases noise pollution in
sider competitors when setting its prices the area.
A. Competitive Pricing
1848. To maximize profit this firm will produce
B. Price Maker quantity at price
C. Equilibrium Price
D. Price Taker
1844. What are the conditions to form a

monopoly?
A. More than one firm producing a variety
of goods
B. 1. One firm2. No variety of goods3.
Complete barriers to entry4. Complete A. Q; D
control over price B. Q; C
1845. Oligopolies may sometimes act like mo- C. Q; B
nopolies when they use cooperative pric- D. Q:A
ing. Which form of cooperative pricing is
legal in the United States? 1849. What government commission ensures
A. cartel formation work places are free of hazards that may
cause death or serious injury?
B. collusion
A. EEOC
C. price leadership
D. all of the above B. FDA
C. FLSA
1846. What type of business organization can
raise capital the easiest? D. OSHA
A. sole proprietorship 1850. Which of the following is not a charac-

B. partnership teristic of monopolistic competition?
C. corporation A. products are very similar so there
must be product differentiation
D. non-profit
B. very competitive
1847. Which of the following may be a nega-
C. lots of advertising
tive externality resulting from the expan-
sion of a local airport? D. identical products

1851. The example from the notes of a busi-

ness that had a pure monopoly was
D.
A. The Post Office
B. The United Parcel Service.
C. Federal Express
1854. Suppose that a perfectly competitive
D. I wasn’t paying attention. firm is currently producing a quantity of
1852. At a price of $2, below the AVC, this output each month at which marginal cost
NARAYAN CHANGDER
firm will produce items. is rising but is still significantly less than
marginal revenue. To maximize profit, the
firm should
A. increase its quantity of output
B. decrease its quantity of output
C. increase its price
A. 8
D. decrease its price
B. 9
C. 11 1855. Perfectly competitive firms are price
D. 0 takers because
E. need more information. A. each firm is very large
1853. The diagram shows the demand curve B. many other firms offer identical prod-
for a firm’s product.Which diagram shows ucts
the shape of the firm’s total revenue (TR) C. there are no close substitutes for their
curve? good
D. their demand curve is downward slop-
ing
1856. Profit Maximization

A. Reducing costs
B. Minimizing expenses
A. C. Maximizing losses
D. Allows producers to charge more for
a better product, because they have con-
vinced consumers that their product is bet-
ter
B.
1857. Collusion exists, even though it is illegal
C.
C. Oligopoly
D. Monopoly

1858. Postal service A. normal profits

A. Natural monopoly B. supernormal profits but higher than

B. Government monopoly monopoly market
C. Technological monopoly C. economic profits
D. Geographic monopoly D. supernormal profits but lower than
monopoly market
1859. How many zeroes are there in TEN MIL-
LION? 1863. Perfectly competitive firms are price
A. 5 takers because
B. 6 A. each firm is very large
C. 7 B. many other firms produce identical
D. 8 products.
1860. SSEMI3 This type of business organiza- C. there are no good substitutes for their
tion is run by a board of directors (who are goods
elected by the stock holders). D. none of above
A. Corporation
1864. Which piece of legislation was the FIRST
B. Sole Proprietorship to regulate market structures and compe-
C. General Partnership tition?
D. Limited Partnership A. Clayton Act
1861. What will happen in the market in the B. Federal Trade Commission Act
long run according to this graph? C. Sherman Anti-trust Act
D. none of above

by a large number of small firms, identical
products, and easy entry for new firms?
A. Monopoly
B. Oligopoly
A. the monopolistic firm’s supply curve
will shift right.
B. the monopolistic firm’s supply curve
will shift left.
1866. Which of the following Brand Names is
C. the market supply curve will shift left. an Oligopoly?
D. The market supply curve will shift A. Raceway Unleaded Gasoline
right.
B. Delta Airline Flights
1862. In the long run, the MONOPOLISTIC
C. Hollister Jeans
COMPETITION market is likely to experi-
ence D. Great Value Milk

1867. Nearly perfect markets are beneficial 1872. Based on your notes how many market
because producers are as efficient as pos- exist?
sible and A. 5
A. consumers do not pay more for a prod- B. 2
uct than it is worth.
C. 4
B. the price of a product bears no rela-
D. 8
tionship to its production costs.
NARAYAN CHANGDER
C. producers can sell at any price they
choose. cell phone service provider industry?
D. the quantity of goods produced is re-
stricted. B. monopolistic competition
C. oligopoly
1868. An externality is a side effect of produc-
tion or consumption that has consequences D. monopoly
A. for consumers only. 1874. The most important laws that promote
competition are collectively called
B. for people other than the producer or
consumer. A. Non-Price Competition
C. for producers and consumers. B. Monopolistic Competition
D. for producers only. C. Anti-Trust Legislation

D. Price Fixing
1869. What type of monopoly is found at all
three levels of government? 1875. Which of the following is an example of
an incentive?
A. Pay Check
B. Hurricane
C. government monopoly
C. Job Loss
D. natural monopoly D. Lower wages
1870. Expenses a new business must pay be- 1876. Characteristics of perfect competition in-
fore the first product reaches the customer clude
A. Barrier to entry A. a large number of buyers and sellers
B. Start up costs B. one firm dominates
C. Perfect Compeition C. a few firms dominate
D. None of the above D. competition is missing
1877. This type of business has limited liabil-
1871. Since movie theaters and video arcades
ity?
provide highly substitutable services, they
may be considered part of the entertain- A. Sole Proprietorship
ment market B. Partnership
A. TRUE C. Corporation
B. FALSE D. Mom and Pop Shop

1878. In the Gilded Age, the steel industry C. self-motivation

was controlled by which business leader?
D. organized
A. John D. Rockefeller

B. Andrew Carnegie 1883. If one gas station lowers gas prices for
the sole purpose of beating the price of the
C. Cornelius Vanderbilt gas station across the street, it could cause
D. JP Morgan a condition known as
1879. A firm in perfect competition is free to A. Disequilibrium

set price at whatever level it pleases B. Complements
A. TRUE C. Elasticity
B. FALSE
D. Substitutes
1880. real or perceived differences between
competing products in the sameindustry. 1884. If the goal of government regulators
of a natural monopoly is to reduce dead-
A. consumer choice weight loss without subsidizing the mo-
B. nonprice competition nopolist, government regulators would set
C. imperfect choice a price equal to:
D. product differentiation A. Average variable cost

B. Average total cost
1881. if this market is perfectly competitive
and the market price is $9 they should pro- C. Average fixed cost
duce (in thousands)
D. Marginal cost
1885. Why is perfect competitive firms are

considered as price takers?
A. Each firm is very large
B. Many other firms produce identical
products.
C. Their Demand curves are downward
sloping.
A. 6
D. There are no good substitutes for their
B. 0 products.
C. 9.5
1886. Price varies by attribute such as a loca-
D. 7
tion or by Customer Segment is degree
1882. Sanjay invested all of his savings to of Price Discrimination
open a sporting goods store in his commu- A. First
nity. WHich quality of entrepreneurs did
Sanjay most display by this action? B. Second
A. Innovative C. Third
B. Willingness to take risks D. Fourth

1887. Which is NOT a characteristic of perfect C. Natural monopoly

competition? D. Resource monopoly
A. difficult entry into the market
1891. A structure in which a single producer
B. many sellers supplies a unique product that has no close
C. identical product substitutes. In an unregulated monopoly,
D. no control over price the producer sets price.
A. Oligopoly
1888. Based on the information in the table,
NARAYAN CHANGDER
which of the following would be Ivory B. Perfect Competition
Coast’s diamond output available after C. Monopoly
trade? D. Monopolistic Competition
1892. When a factory pollutes a river, the re-
sulting water pollution is an example of a
A. 18 diamonds
B. public good
B. 20 diamonds C. negative externality
C. 30 diamonds D. neutral spillover effect
D. 50 diamonds
1893. Although many people are involved, it is
1889. SSEMI3 b This is a good that is virtually treated by the law as though it were one
identical. Examples would be corn or crude person
oil. A. Sole proprietorship
A. Commodity B. Partnership
B. Want C. Corporation
C. Luxury item D. none of above
D. none of above
1894. Battle of the Classes Volleyball Winning
1890. Uncle Booger has a special license to be class
the only producer of the Bumper Dumper. A. freshmen
This type of legal monopoly is known as:
B. sophomores
C. seniors
D. juniors
1895. What type of monopoly is based on
based on the absence of other sellers in
a certain area?
A. Natural Monopoly
A. A franchise C. Technological Monopoly
B. A patent/copy right D. Government Monopoly

1896. A market structure in which very few 1902. Which of the following will not increase
large sellers dominate the market is called the demand for education in Nigeria?
what?

A. favourable government policies
A. oligopoly B. increase in tuition
B. monopoly C. increase in Abuja residents
C. pure competition D. increase in the number of schools na-
D. perfect competition tionwide
1897. A monopoly can best be summed up as 1903. Monopolists are able to divide con-
sumers into groups and charge different
A. many producers, identical products prices. What is the name of this market
B. few producers, similar products practice?
C. many producers, similar but varied A. non-price competition
products B. price competition
D. one producer, a unique product C. price discrimination
1898. Products have the same basic purpose D. price fixing
with some differences
1904. Laws that give government the power
A. Product differentitation to control monopolies and to break them
B. Price takers up are called
C. Collusion A. antimonopoly laws
D. none of above B. antitrust laws

C. antimerger laws
1899. The price of labor is known as
D. none of above
A. Cost
1905. When a firm sees average production
B. Competition
cost go down, they are experiencing
C. Trust
A. economies of scale
D. Wage B. introductions of grandeur
1900. Which of the following is the most com- C. start up costs
petitive market structure? D. monopoly
1906. True or False:Non-profit organizations
B. Monopolistic competition do not pay taxes.
C. Monopoly A. True
D. Oligopoly B. False
1901. The degree of the product differentia- 1907. Which of the following is an example of
tion monopolistic competition?
A. number of companies on the market A. bananas
B. degree of product differentiation B. public water

C. grocery stores C. Economies of scale, natural monopo-

D. running shoes lies, and skill requirements
D. Limiting information, high barriers of
1908. Some goods or services can by “con- entry, and specific product
sumed” by individuals who do not have
to pay for them to enjoy them, and in fact 1912. A permit that the government grants to
there is no practical way to make people a firm to operate a business is known as
pay for them. As a result, the market does
not allocate resources sufficiently to pro-
NARAYAN CHANGDER
vide those services or goods. What are
these goods and services known as?
A. Public goods
B. Externalities
C. Market failures
D. Negative A. a Business License
1909. In a monopoly which of the following is B. a Natural Monopoly
not true? C. a Franchise
A. Products are differentiated D. a Government Monopoly
B. There is freedom of entry and exit into
the industry in the long run 1913. In a competitive industry, if the price of
a product is trending upwards for what-
C. The firm is a price maker ever reason, then it is likely
D. There is one main seller A. the price will come back down because
1910. Entrepreneurs play an important role in buyers don’t want it to be too high
the economic system of the United States B. sellers will start being more careless
becausethey with their costs
A. understand best the complex nature C. the government will step in with effec-
ofgovernment regulations. tive price control measures
B. develop new and more efficient ways D. more firms will enter the market be-
to use resources. cause they start seeing they can make
C. are most aware of continuing de- some money there
mands for product reliability and con- 1914. If Mark Etts expresses a desire to sell
sumer safety. his corn at a local farmer’s market, he
D. have the marketing skills needed to must be aware that the product is stan-
succeed in corporations. dardized and that he will have no control
over the price. The market structure he is
1911. What are the barriers to entry by mo- MOST likely participating in is
nopolies?
A. Start-up costs, skill requirements, and
brand recognition B. oligopoly
B. High barriers of entry, patents/copyrights, C. perfect competition

and mergers D. monopoly

1915. Why does no one firm dominate in a per- 1920. The demand curve for a firm in perfect
fect competition? competition is vertical.

A. No firm wants to A. True
B. Each firm sells to different people B. False
C. Each firm produces exactly the same 1921. When businesses set prices below cost
towards total supply that they cannot infor a time for the sole purpose of putting
fluence prices their competitors out of business
D. One firm will eventually dominate and A. Price fixing
make it a monopoly B. Market allocation
1916. Which market structure involves selling
identical products? D. Perfect competition
A. Perfect Competition 1922. Standard Oil was controlled by which

business leader?
A. John D. Rockefeller
1917. This is where goods and services are il- B. Andrew Carnegie
legally bought and sold in violation of price
C. Cornelius Vanderbilt
controls
D. JP Morgan
A. Flea Market
1923. Business can easily manipulate Prices
B. Black Market
A. Oligopoly
C. Farmer’s Market
B. Monopoly
D. Super Market
1918. One seller D. none of above
A. Price Takers 1924. Which of these economic goals is con-
cerned with using resources wisely and re-
B. Monopoly
ducing waste?
C. Oligopoly
A. economic security
D. Price Fixing B. economic equity
1919. Many buyers and sellers participate in C. economic freedom
the market. 2. Sellers offer identical prod- D. economic efficiency
ucts. 3. Buyers and sellers are well in-
formed about products. 4. Sellers are able 1925. Karen uses both price and product differ-
to enter and exit the market freely. Low entiation to compete with her business ri-
start-up costs and low technology needed. vals. What market structure does her busi-
ness operate in?
A. Monopoly
B. Oligopoly B. Oligopoly
C. Monopolistic Competition C. Monopolistic Competition
D. Perfect Competition D. Monopoly

1926. the expenses a firm must pay before it C. boycott

can begin to produce and sell goods D. lockout
A. start-up costs
B. barriers to entry companies in monopolistic competition?
C. entry fees A. Nike, Regal Cinemas, Toyota
D. copyrights B. Netflix, Hulu, Amazon Prime
NARAYAN CHANGDER
1927. One DISADVANTAGE of a corporation is C. Coca-Cola, Adidas, General Electric
that D. AT&T, Universal Studios, Kellogg’s
A. it has limited liability.
1933. A business that cannot set the prices for
B. it has unlimited liability. its products but accepts the market price
C. it is taxed twice. that is set by Supply and Demand
D. none of above A. Sole Proprietorship
B. Price Taker
1928. In Perfect Competition there are high
barriers to entry C. Cartel
A. true D. Price Maker
B. false 1934. Is no transaction cost a characteristic of
monopoly market?
1929. According to Lionel Robbins, what are
ends? A. True
A. needs B. False
B. resources 1935. Firms in this kind of market produce

goods that have very close substitutes.
C. demand
D. supply
1930. occurs when all companies sell identical
C. Pure Monopoly
products, market share does not influence
price, companies are able to enter or exit D. Oligopoly
without barriers, buyers have perfect or
1936. why does the government give patents
full information, and companies cannot de-
to companies (and create monopolies)?
termine prices
A. to control prices
A. Monopoly
B. to control output of goods
B. Market
C. to allow the company to make back
their investment
D. none of above
D. to allow price discrimination
1931. An organized refusal to buy from a par- 1937. When businesses make an agreement to
ticular company is called: split up geographic areas for business pur-
A. strike poses, it is called a
B. picket A. Barrier to Entry

B. Monopoly 1943. What is perfect competition?

C. Carton A. When many suppliers produce the

D. Cartel same goods
B. When a few firms dominate the market
1938. How many phases are in the Business
Cycle? C. When there is only one major supplier
A. 2 D. When several companies sell similar

products
B. 4
1944. If the government set the price at $700,
C. 6
would that be a price ceiling or floor?
D. 8
1939. What is the main source of market

power in monopolistic competition?
A. Price discrimination
C. Economies of scale
1940. What is the equilibrium condition for a

A. Price Ceiling
monopolistic competition firm?
B. Price Floor
A. Average revenue equals average cost
C. Neither
B. Total revenue equals total cost
D. none of above
C. Price equals marginal cost
D. Marginal revenue equals marginal 1945. The most likely outcome when both ag-
cost gregate supply and aggregate demandin-
crease is:
1941. Which market structures would have
A. a rise in inflation.
MR lower than its Price?
B. higher employment.
C. an increase in nominal GDP.
B. Oligopoly
D. none of above
D. Monopoly 1946. If two competing soft drink companies
decided to merge and combine into one
1942. Which below is NOT a type of company, this would be an example of
monopoly? what?
A. Natural Monopoly A. A conglomerate
B. Government Monopoly B. A vertical merger
C. Differentiated Monopoly C. A horizontal merger
D. Geographic Monopoly D. A corporation

1947. WHAT IS THE MAIN CHARACTERISTIC 1953. I am a weasel.

OF MONOPOLISTIC COMPETITION A. True
A. PRODUCTS ARE UNIQUE, DIFFERENT B. False
B. PRODUCTS ARE THE SAME C. I’m really more of a ferret.
C. WELL INFORMED BUYERS AND SELL- D. Depends on how I’m feeling today.
ERS
1954. The additional revenue that will be gen-
D. FREEDOM OF ENTRY AND EXIT
erated by increasing product sales by one
NARAYAN CHANGDER
1948. The diagram represents a unit.
A. increase in demand A. Profit
B. decrease in demand B. Marginal Revenue
C. Relative Revenue
1949. A sole supplier of a product with no
close substitutes D. Profit Maximization
A. Monopoly 1955. Stocks: Bonds:

B. Oligopoly A. supply, demand
C. Monopolistic Competition B. dividends, interest
D. Perfect Competition C. lending, buying
E. Barriers to entry D. corporation, sole proprietorship
1950. Who would NOT be considered an en- 1956. What is the relationship between
trepreneur? marginal revenue and price elasticity of
demand?
A. A doctor who starts their own practice
A. They are directly related
B. A doctor who works at a hospital
B. They are inversely related
C. A doctor who wrote a book in their
C. They have no relationship
spare time
D. They are unrelated
D. none of above
1957. To attract buyers, monopolistic competi-
1951. Government subsidies have the effect tors tend to rely on
of
A. low prices
A. lowering the cost of production
B. superior products
B. reducing supply
C. price controls
C. lowering output
D. advertising and promotions
D. raising production costs
1958. A monopoly that exists because a firm
1952. Perfect competition involves: controls an invention is called a
A. Sellers working together to set prices A. geographic monopoly
B. A large number of buyers & sellers B. technological monopoly
C. Difficulty entering & exiting the market C. natural monopoly
D. Little information is available to buyers D. none of above

1959. A socialist economy would pursue all of A. True

the following measures or goals EXCEPT B. False

A. public ownership of property.
1965. Following a sharp increase in the price
B. economic planning by the government. of energy, the overall price level is most-
C. laissez-faire policies. likely to rise in the short run
D. none of above A. and remain elevated indefinitely un-
less the central bank tightens.
1960. Four Kinds of Monopolies
B. but remain unchanged in the long run
A. Natural, Government, Technological, unless the money supply is increased.
Geographic
C. and continue to rise until all prices
B. Natural Monopoly have increased by the same proportion.
C. Government Monopoly D. none of above
1966. If you expect gas to be more expensive
1961. Which of the following is largely respon- tomorrow, you might buy gas
sible for the growth of a free enterprise A. today
system?
B. tomorrow
A. government
C. yesterday
B. Gross Domestic Product
D. next tuesday
C. market efficiency
D. profit motive 1967. If a market changes from monopoly to
perfect competition, what will happen?
1962. Which market structure has relatively A. prices will increase and market quan-
low entry and exit barriers and firms pro- tity will rise
duce differentiated products?
B. prices will fall and market quantity will
A. Perfect Competition rise
B. Monopolistic Competition C. prices will fall and market quantity will
C. Oligopoly fall
D. Monopoly D. nothing
1963. A market structure that has only a few 1968. It is extremely easy to go into and get
sellers that offer a similar product. out of the business.
A. monopoly A. Perfect Competition
B. oligopoly B. Pure Monopoly
C. price fixing C. Monopolistic Competition
D. perfect competition D. Oligopoly
1964. True/False:The monopolist is a price 1969. The unique feature of an oligopoly mar-
maker, which means he/she can change ket is that the actions of one seller have
the price of the product in order to mini- a significant impact on the profits of all of
mize profits. the other sellers in the market

A. TRUE 1974. A perfect competitive firm charges a

B. FALSE price that is
A. different to other firms
1970. A single price monopoly transfers
B. higher than other firms
C. lower than other firms
D. similar to other firms
NARAYAN CHANGDER
a geographic monopoly?
A. the only gas station in a radius of one
mile
A. economic profit to the government.
B. the only restaurant in a radius of 200
B. economic profit to consumers. miles
C. consumer surplus to producers. C. a store in Chicago that sells only
D. producer surplus to consumers. leather goods
E. economic profit to deadweight loss. D. none of above
1976. Which market structure has some con-

1971. Which of the following is characterized
trol over pricing and is relatively easy to
by high barriers to entry?
enter into?
A. Monopoly
B. Pure Competition
C. Oligopoly
C. Oligopoly
D. Free Market
D. Monopoly
1972. allows parties to exchange goods or ser- 1977. A pure monopoly will produce the same
vices to produce products amount of output as perfect competition
A. Imperfect Competition when
B. Resource Market
C. Free Market
D. none of above
1973. If a company was trying to figure out

a way to advertise the differences in their
shoes, that company would most likely fit
in the market structure of
A. all the demanders pay one price.
B. it provides more consumer surplus
B. Monopolistic Competition than perfect competition.
C. Oligopoly C. it can perfectly price discriminate.
D. Monopoly D. it is forced into the fair return price.

1978. About how many hours of babysitting D. there are large number of barriers to
will be demanded at $4 per hour? entry into this market structure

1982. There are many substitute products
available to choose from in a perfectly com-
petitive market structure.
A. True
B. False
A. 20 1983. In what market form would companies

engage in collusion or price fixing?
B. 35
C. 40
D. 55 B. Perfect (Pure) Competition
C. Oligopoly
1979. Which economic system relies on cus-
toms, traditions, and cultural beliefs to D. Monopoly
make economic decisions?
1984. Which of the following are characteris-
A. Traditional economy
tics of an oligopolistic market?
B. Command economy
A. identical products
C. Socialist economy
B. identical prices
D. Capitalist economy
C. a few firms that sell most of the prod-
1980. List the four market structures in the or- ucts
der from least competitive to most compet-
itive. D. consumers value quality
A. Oligopoly, Monopoly, Perfect Competi- E. The companies advertise, A LOT
1985. This occurs when large firms produce
B. Perfect Competition, Oligopoly,
more than 80% of the total industrial out-
Monopoly, Monopolistic Competition
put
Competition, Perfect Competition A. Perfect Competition
D. Monopoly, Monopolistic Competition, B. Monopolistic Competition
Perfect Competition, Oligopoly C. Oligopoly
1981. The market structure of pure competi- D. Pure Monopoly
tion is distinctive because-
A. only one seller is needed in this market 1986. Number of sellers in an oligopoly
structure A. One
B. there are no examples of this type of B. A few
market structure
C. Many
C. the sellers in this market structure
have no control over price D. none of above

1987. Kai, Charlotte, and Nora are running dif- 1991. When quantity demanded is equal to
ferent coffee shops in a monopolistic com- quantity supplied, the result is
petition. What physical characteristics can
they use for non-price competition?
A. Location of their coffee shop, level of
service, and advertising
B. Location of their coffee shop, level of
service, and image or status of their cof-
NARAYAN CHANGDER
fee shop
C. Level of service, advertising, and im- A. Price Floor
age or status of their coffee shop B. Disequilibrium
D. Location of their coffee shop, advertis-
C. Equilibrium
ing, and image or status of their coffee
shop D. Surplus
1988. The name given to the ideal price and 1992. Which of the following markets is NOT
quantity sold of a product so that both sup- likely to be an example of perfect compe-
ply and demand can be maintained. tition
A. Shortage
A. Agricultural products
B. Incentive
B. The market for brownies at First Coast
C. Economics
C. A large corporation
D. Equilibrium
D. All of the previous are examples of per-
1989. Role of Government fect competition
A. The government has the power to
maintain competition and regulate certain 1993. Perfect competition is characterized by
monopolies that exist for the public’s wel-
A. Many large firms.Identical products
fare.
Easy entry.
B. The impact of government on a society
B. Few large firms.Identical products
C. The importance of government in a so- Easy entry.
ciety
C. Few large firms.Identical products
D. The role of government in a society
Hard entry.
1990. Nike signed Michael Jordan in 1984 in D. none of above
order to get more young people to buy
Nike instead of Converse or adidas. They 1994. Characteristics of perfect Competition
tried to show their shoe was cool and all expect
therefore superior. This is-
A. No transaction cost
A. monopoly
B. monopolistic competition B. Many buyers and sellers
C. oligopoly C. Price bias

D. perfect competition D. Company makes similar products

1995. A formal, illegal agreement between C. many sellers struggle to get market
firms to set prices or behave in a coopera- share
tive manner is an example of

D. firms are so powerful they make gov-
A. Trust ernment submit to them
B. Collusion 1999. The Austrian economic school attributes
C. Economies of scale the primary cause of the businesscycle to:
D. Oligopoly A. misguided government intervention.
B. the creative destruction of technologi-
1996. What is the profit-maximizing combina- cal progress.
tion of output and price for the single price
monopoly shown here? C. sticky price and wage expectations
that exaggerate trends.
D. none of above
2000. Which of these are features of pure com-

petition?
A. many firms
B. barriers to entry
C. identical products
D. high barriers to entry
A. Q2 and P1
2001. In Perfect Competition products are dif-
B. Q1 and P1 ferentiated
C. Q2 and P3 A. true
D. Q1 and P4 B. false
E. Q1 and P3 2002. SSEMI3 b A technological monopoly can
be established if only one firm can sell
1997. Which of the following statements is in
a product because the government has is-
correct?
sued them a:
A. Under monopoly there is no difference
A. Patent
between a firm and industry
B. Price Ceiling
B. A monopolist may restrict the output
and raise the price C. Supply monopoly
C. Free entry and exit in a Monopoly Mar- D. Surplus
ket
2003. The greater the competition in market,
D. Product differenciation is peculiar to the greater the profit
monopolistic competition
A. True
1998. An oligopoly is an industry where B. False
A. one seller dominates C. Neither
B. a few sellers dominate D. none of above

2004. Elasticity refers to C. Monopoly, Oligopoly, Monopolistic

A. how producers of goods and services Competition, Perfect Competition
react to price changes D. Monopoly, Monopolistic Competition,
B. how sensitive consumers are in react- Perfect Competition, Oligopoly
ing to price changes of goods and services
2008. Which of the following has many buyers
C. how far a supply of scarce goods can
and many sellers?
be stretched
NARAYAN CHANGDER
D. how often the price of a good or ser- A. monopoly
vice changes when quantity demanded B. duopoly
changes
C. oligopoly
2005. When all inputs increase by 10%, out-
put rises by 5%. What is this economic
phenomenon?
2009. Oligopolies and monopolies are the
A. Diminishing marginal returns same because
B. Increasing marginal returns
C. Increasing returns to scale
D. Decreasing returns to scale
2006. Home Depot participates in which mar-

ket structure?
B. monopoly A. They both have many buyers and sell-
C. monopolistic competition ers.
D. oligopoly B. They both are the only sellers of their

product.
2007. List the four market structures in order
from least competitive to most competi- C. They both have identical products.
tive. D. They both have high barriers to entry.
2010. “Pure monopoly” should replace what

letter in the table?
A. P
A. Oligopoly, Monopoly, Perfect Competi- B. R
C. Q
B. Perfect Competition, Oligopoly,
Monopoly, Monopolistic Competition D. S

2011. Government monopoly A. Equilibrium

A. monopoly created and or owned by the B. Monopoly

government
C. Imperfect Competition
B. the exclusive legal right, given to an
originator or an assignee to print, publish, D. Command Economy
perform, film, or record literary, artistic,
2016. If the corn industry is perfectly compet-
or musical material, and to authorize oth-
itive and the market price for corn is $3
ers to do the same.
per bushel. How many bushels will Farmer
C. market structure in which the average Kardashian sell at $3.50 per bushel?
costs of production are lowest when all
output is produced by a single firm
D. a government authority or license con-
ferring a right or title for a set period, es-
pecially the sole right to exclude others
from making, using, or selling an inven-
tion.
2012. MONOPOLISTIC COMPETITION can be

seen as a mixture between and
market structures.
A. monopoly and oligopoly
B. perfect competition and oligopoly
C. perfect competition and monopoly
D. none of above
A. more than she would at a price of $3
2013. Exists when there are no other produc- per bushel
ers within a certain region B. some, but fewer than she would at $3
A. Natural monopoly per bushel
B. Government monopoly C. just as many as she would at $3 per
C. Technological monopoly bushel
D. Geographic monopoly D. none

E. more info is needed about the prices
2014. A market structure where each firm is a
of other farmers
small part of the total industry in which it
operates is 2017. This market structure can act like a
A. an oligopoly monopoly when the firms all set prices the
B. a monopoly same
C. a competitive market A. Monopoly

D. monopolistic competition B. Monopolistic Competition
2015. When Supply and Demand are the same,
what condition exists? D. Oligopoly

2018. Refer to the diagram. What price will D. AC pricing, and not MC pricing, can be
the monopolist charge in order to max- used by a government to regulate a natu-
imise profit? ral monopoly.
2022. the harm, cost or inconvenience suffered
by a third party because of actions of oth-
ers.
A. neutral externalities
NARAYAN CHANGDER
B. positive externalities
C. primary externalities
A. £3
D. negative externalities
B. £7
2023. Someone who enjoys the benefit of a
C. £4 good or service without paying for it. (Mr
D. £5 Macerata and NPR )
A. Dead Weight Loss
2019. In a perfectly competitive market the
products are commonly called B. Oligopoly
A. commodities C. Free Rider
D. Free loader
B. consumable
C. contractual 2024. A monopoly is a market with
D. competitive A. no barriers to entry
B. many substitutes
2020. What is a monopolistic competition?
C. many suppliers
A. A market structure with no competi-
D. one supplier
tion
B. A market structure with only one firm 2025. What needs to be true in order for a mo-
selling a unique product nopolist to price discriminate?
C. A market structure with many firms A. Some customers must have a higher
selling identical products reservation prices than others for the
same good
D. A market structure with many firms
B. All customers must have the same
selling differentiated products
reservation prices for the same good
2021. What is the difference between average C. It must be possible for customers to
cost (AC) pricing and marginal cost (MC) resel the good.
pricing? D. The firm cannot have market power
A. Allocative efficiency is attained under
2026. Reductions of combined consumer and
AC pricing but not so under MC pricing.
producer surplus
B. AC pricing allows the firm to earn nor-
A. Deadweight loss
mal profits but MC pricing will give rise to
subnormal profits. B. Elasticity
C. AC pricing, and not MC pricing, allows C. Tax incidence
the firm to maximise profits. D. Surplus

2027. A large telephone company has hired 2032. A large producer of business and per-
lobbyists to try to persuade lawmakers to sonal computers buys a company that pro-
reduce governmental regulation over the duces computers for the home market.

telecommunications industry. Why might
A. Horizontal
the company do this?
A. Some regulations are costly to imple- B. Vertical
ment and cut into profits.
C. Conglomerate
B. Many regulations promote too much
competition, driving down prices. D. none of above
C. Certain regulations result in rapid busi-
2033. Firms face competition when they pro-
ness growth, which some companies find
duce a good
difficult to handle.
D. All of these A. in a market with natural barriers to en-
try
2028. Levi’s jeans are part of
B. that has a close substitute
A. a monopoly
B. an oligopoly C. is unique
C. Monopolistic Competition D. in a market with legal barriers to entry
2034. Luna, Aria, and Lily are running a lemon-
2029. The fast food industry would be be cat- ade stand in a Perfectly Competitive Mar-
egorized as: ket. What does their supply curve repre-
A. perfect competition sent?
B. oligopoly A. Shows the quantity of lemonade that
C. monopolistic competition they are willing and able to consume at dif-
D. monopoly ferent prices
2030. A person who does not pay for a good B. Shows the quantity of lemonade that
but benefits from it anyways is known as they are willing and able to buy at differ-
a ent prices
A. Jerk C. Shows the quantity of lemonade that

they are willing and able to produce at dif-
B. Free rider
ferent prices
C. Cartel
D. Shows the quantity of lemonade that
D. none of above
they are willing and able to sell at differ-
2031. Which market structure is characterized ent prices
by a large number of firms selling differen-
tiated products? 2035. This is a partner of a business that only
A. Monopolistic competition has (usually smaller) financial stake in the
business.
C. Monopoly A. Limited Partner
D. Oligopoly B. General Partner

2036. Which of the following would be consid- 2041. Which of the following best describes
ered “unfair” business methods? the U.S. Postal Service?
A. Price-cutting A. A perfectly competitive firm
B. Discounts B. Monopoly
C. Competitive pricing C. Oligopoly
D. Product differentiation D. Monopolistic competition
NARAYAN CHANGDER
2037. In monopolistic competition, each firm 2042. Sole proprietorship business owner has
supplies a small part of the market. This A. Restricted Liability
occurs because
B. No Liability
A. firms produce differentiated products.
C. Unlimited Liability
B. there are a large number of firms.
D. Limited Liability
C. there are no barriers to entry
2043. Mr. Simpson is liable for all the debts
D. there are barriers to entry
of his company. What type of business or-
2038. To maximize profit, a monopolistically ganization is this?
competitive firm A. monopoly
A. takes the price as a given and chooses B. corporation
its quantity, just as a competitive firm
C. conglomerate
does.
B. takes the price as a given and chooses
its quantity, just as a colluding oligopolist 2044. If Mark expresses a desire to sell his
does. corn at a local farmer’s market, he must
C. chooses its quantity and price, just as be aware that the product is standardized
a competitive firm does. and identical to others and that he will
have no control over the price. The market
D. chooses its quantity and price, just as structure he is MOST likely participating in
a monopoly does. is
2039. In 1890, the government passed the A. monopolistic competition
Sherman Antitrust Law to B. oligopoly
A. prevent future monopolies C. perfect competition
B. break up a major monopoly D. monopoly
C. regulate existing monopolies
2045. U.S. agriculture is most closely associ-
D. create zones for existing monopolies ated with which of the following markets?
2040. Costs that change as the quantity of out- A. monopolistic competition

puts changes. B. perfect competition
A. Fixed Costs C. monopoly
B. Variable Costs D. oligopoly

2046. This single farmer is experiencing C. Command

D. Traditional

2051. AN AGREEMENT AMONG MEMBERS OF
AN OLIGOPOLY TO SET PRICES AND PRO-
DUCTION LEVELS.
A. PREDATORY PRICES
B. PRICE FIXING
C. CARTELS
A. economic loss. D. COLLUSION
B. economic profit.
2052. Allocative efficiency occurs where
C. break-even.
A. P = MC
D. normal profit.
B. P = ATC
E. long run equilibrium. C. P = min ATC
2047. If the demand for a good increases when D. MR = MC
people’s incomes increase, E. MR = 0
A. the good is an inferior good
2053. A market that runs most efficiently
B. the law of demand is violated when one large firm provides all of the
C. the good’s demand curve must be up- output. It’s inconvenient or impractical
ward sloping to have several competing firms. Exam-
ple:Electric company for DR
D. the good is a normal good
A. Natural Monopoly
2048. A producer’s demand for labor is called B. Monopoly
A. Supply and Demand
D. Oligopoly
B. Minimum Wage
2054. A firm in perfect competition faces a hor-
C. Market Allocation izontal demand curve for all of the follow-
D. Derived Demand ing reasons except that
2049. Product Differentiation A. the firm takes the price as given from
the market
A. Creating a new product
B. the product the firm sells is identical
B. Lowering the price of a product to the product sold by other firms in the
C. Increasing the advertising budget market
D. Product differentiation may be real or C. the firm is unable to influence the mar-
perceived. ket price because of its small size
D. the firm’s sales are limited so it is
2050. Which type of economy did Adam Smith impossible for the firm to sell more and
promote? lower the price
A. Market E. the firm can sell as much as it wants at
B. Mixed the price established in the market

2055. Local stores sell a particular pair of D. producers differentiate their products
sneakers for $80. A picture of a bas- to show superiority
ketball star Lebron James wearing these
sneakers appears in all the local Ohio 2060. How many firms are there in a
newspapers. The next day, sales for monopoly?
sneakers start to rise. What is likely to A. 1
happen to the price of the sneakers over B. 2 or more
the next several weeks?
C. Many
NARAYAN CHANGDER
A. People will refuse to buy these sneak-
ers. D. A few
B. The price for the sneakers will not 2061. One Seller
change. A. Perfect Competition
C. The price will fall as people learn Le- B. Monopolistic Competition
bron James wears them.
C. Oligopoly
D. The price of the sneakers will rise as
more people want similar sneakers. D. Monopoly
2056. Cars, movie studios, cell phone service, 2062. Which of the following is a NEGATIVE
airlines are examples externality?
A. Pollution
B. Coming to school sick
C. Blasting loud music outside in the mid-
C. Oligopoly
dle of the night
D. Monopoly
D. All of the above
2057. It is usually very difficult to enter a mar-
2063. When competing businesses work to-
ket that is a monopoly.
gether and agree to set prices for their
A. True competing products
B. False A. Price fixing
2058. the ability of a company to change prices B. Market allocation
and output like a monopolist C. Predatory pricing
A. market power D. Merger
B. market ability
2064. A monopoly is characterized by having
C. market trends no substitutable goods.
D. market influence A. TRUE
2059. The main characteristics of a Monopolis- B. FALSE
tic Competition include 2065. An oligopoly is a market or an industry
A. buyers not well-informed on products A. that is dominated by just a few firms
B. strict gov’t regulations that produce similar or identical products.
C. buyers purchase based on brand loy- B. in which a large number of firms pro-
alty duce essentially the same product.

C. that consists of a single producer of a C. An oligopoly is a market structure

product that has no close substitutes. characterized by perfect competition
among firms.

D. in which a large number of producers
provide goods that are similar but varied. D. An oligopoly is a market structure char-
acterized by a small number of large firms
2066. What is a monopoly? dominating the market.
A. When many suppliers produce the
same goods 2070. Which of the following is the least com-
B. When a few firms dominate the market petitive market structure?
C. When there is only one major supplier A. Perfect competition

D. When several companies sell similar B. Monopolistic competition
products C. Oligopoly
2067. In which market structure is there the D. Monopoly
MOST competition?
A. Monopoly 2071. A market structure characterized by
firms producing similar product with easy
B. Oligopoly entry into the market
2068. In this market structure there is only C. Monopoly
one seller with a unique product
D. none of above
2072. The defining characteristic of a natural

monopoly is
A. constant marginal cost over the rele-
vant range of output
B. economies of scale over the relevant
A. monopoly range of output
B. perfect competition C. constant returns to scale over the rel-

evant range of output
D. diseconomies of scale over the rele-
D. oligopoly
vant range of output
2069. What is an oligopoly?
2073. Very HIgh to complete barriers to entry
A. An oligopoly is a market structure char-
acterized by a large number of small firms A. Perfect Competition
dominating the market. B. Monopolistic Competition
B. An oligopoly is a market structure char-
C. Oligopoly
acterized by a single firm dominating the
market. D. Monopoly

2074. Why does the government regulate nat- E. Its marginal revenue curve is higher
ural monopolies? than its average total cost curve.
A. To increase competition in the market 2078. True or False:Firms An oligopoly is a
B. To prevent the monopoly from charg- market dominated by just a few firms who
ing excessively high prices have no control over the price of their prod-
C. To ensure the monopoly provides an ucts
adequate, high-quality amount of the prod- A. True
NARAYAN CHANGDER
uct B. False
D. All of the above are possible reasons
for regulation 2079. Coke and Pepsi are examples of this
type of market:
2075. Cartels are illegal in the United States. A. Perfect competition
A. True B. Monopolistic competition
B. False C. Oligopoly
2076. An individual or group who purchases D. Monopoly
goods.
2080. What is the unethical and dangerous be-
havior that cartels engage in?
A. Competition
B. Coercion
C. Coordination
D. Collusion
2081. Refer to the graph shown. When the

market price rises from P1 to P2, con-
A. producer sumer surplus:
B. consumer
C. goods
D. services
2077. If a firm must lower its price to sell more

of a good, which of the following must also
be true?
A. Its marginal revenue curve is the same
as its marginal cost curve.
B. Its marginal revenue curve is upward- A. Increases by an amount equal to A
sloping. B. Decreases by an amount equal to B +
C. Its marginal revenue curve is lower C
than its demand curve. C. Increases by an amount equal to B +
D. Its marginal revenue curve is equal to C
its demand curve. D. Decreases by an amount equal to C

2082. Anika, Sophia, and Aria are playing a D. Market structure where firms sell iden-
game of ‘Market Masters’. They are dis- tical products
cussing different market structures. Anika

asks, ‘What is perfect competition?’ Can 2085. If Annie & Skye need to raise a lot of
you help them answer? capital, which type of organization might
A. Perfect competition is a market struc- they choose & what tradeoff might they
ture where there are many buyers and make?
sellers, differentiated products, limited in- A. Partnership; gain $ & give up limited
formation, high barriers to entry or exit, liability
and individual firms have control over the
market price. B. Partnership; gain $ & give up most con-
trol
B. Perfect competition is a market struc-
ture where there are few buyers and sell- C. Corporation;gain $ & give up most con-
ers, heterogeneous products, imperfect trol
information, high barriers to entry or exit, D. Corporation; gain $ & give up unlimited
and individual firms have control over the life
market price.
C. Perfect competition is a market struc- 2086. Which of the following is NOT a form of
ture where there are few buyers and sell- non-price competition?
ers, homogeneous products, perfect infor-
A. location
mation, no barriers to entry or exit, and
individual firms have control over the mar- B. physical characteristics
ket price.
C. advertising
D. Perfect competition is a market struc-
ture where there are many buyers and D. discounts
sellers, homogeneous products, perfect
2087. What are the barriers to entry in a
information, no barriers to entry or exit,
monopoly market?
and no individual firm has control over the
market price. A. Low start-up costs
2083. markets where many businesses sell B. Lack of control of essential resources
products that are similar, but not identical C. No legal barriers
D. High start-up costs, control of es-
B. monopolistic competition sential resources, legal barriers, and
C. oligopoly economies of scale
D. monopoly
2088. Redcues extreme ups and downs in our
2084. Monopolistic Competition economy and helps to keep prices from
A. Has the same conditions as pure com- changing too quickly
petition except for identical products. A. security
B. Market structure where only one firm B. growth
sells a product
C. full employment
C. Market structure where there is no
competition D. stability

2089. Which industry best exemplifies an 2094. When the government creates a law
oligopoly? used to protect individuals this is know as:
A. fast-food A. Deregulation
B. farming B. Regulation
C. women’s clothing C. Positive Externality
D. publishing D. Preventing a market failure
2090. Businesses that have no control over
NARAYAN CHANGDER
2095. In monopolistic competition, how do con-
price
sumers differentiate between the goods
A. Price Takers produced by different firms?
B. Monopoly A. Price difference
C. Oligopoly
B. Brand names and packaging
D. Price Fixing
C. Taste difference
2091. Equality between aggregate expendi- D. All of the above
ture and aggregate output implies that the-
government’s fiscal deficit must equal: 2096. Which market structure has a single
A. Private saving-Investment-Net ex- seller with no close substitutes?
ports. A. Oligopoly
B. Private saving-Investment + Net ex- B. Perfect competition
ports.
C. Monopoly
C. Investment-Private saving + Net ex-
ports. D. Monopolistic competition
D. none of above 2097. Which type of monopoly is allowed to
2092. What is the purpose of the Consumer Fi- exist because there is only one company
nancial Protection Bureau? legally allowed to provide this service?
A. to provide oversight and guidance in A. Natural Monopoly
the financial lending industry B. Geographic Monopoly
B. to oversee the safety of food and phar- C. Government Monopoly
maceuticals
C. to prevent sellers from making false
claims about their products 2098. Which of the following are characteris-
D. to require corporations to share finan- tics of a monopolistically competitive mar-
cial information with their stockholders ket?
2093. Which market structure did John D. A. identical products

Rockefeller’s Oil industry fall under? B. identical prices
A. Monopoly C. a few firms that sell most of the prod-
B. Oligopoly ucts
C. Perfect Competition D. consumers value quality
D. Monopolistic Competition E. many different prices

2099. lowest barriers to entry

A. monopoly

B. oligopoly
D. none of above
A. monopoly
2100. The right to sell a good or service within B. oligipoly
an exclusive market
A. Franchise
B. Branding
2105. The European Union fined Google for be-
C. free market ing a monopoly
D. open market A. False
B. True
2101. In a market with perfect competition,
how are prices determined? 2106. One of the requirements for a monopoly
A. by supply and demand is that
A. there is a unique product with no close
B. by government regulation
substitutes
C. by cultural ideals of fairness.
B. the product cannot be produced by
D. by agreement among producers small firms.
C. there are several close substitutes for
2102. the division of consumers into groups the product
good D. none of above
A. Cartel 2107. Based on typical labor utilization pat-

terns across the business cycle, produc-
B. Price Discrimination tivity(output per hours worked) is most
C. Collusion likely to be highest:
D. Price War A. at the peak of a boom.
B. into a maturing expansion
2103. How can oligopolies legally control
C. at the bottom of a recession.
prices?
D. none of above
A. collusion
2108. A single supplier that constitutes the en-
B. standardized products
tire industry is an example of
C. price leadership
A. an Oligopoly
D. conglomerates B. a Competitive Market
2104. Price fixing and collusion often occur in C. a Monopoly

this type of market structure D. none of above

2109. What is an example of an oligopoly mar- 2115. Which business organizations have “un-
ket? limited liability”? (pick 2!)
A. Fast food industry A. Sole proprietorships
B. Smartphone industry B. Corporations
C. Clothing industry C. Partnerships
D. Automobile industry D. All of the above
NARAYAN CHANGDER
2110. The exclusive right to do business in a
2116. Nike, Google and Apple are examples of
certain area without competition
A. turf
A. Sole Proprietorships
B. franchise
B. Partnerships
C. regional choice
C. Corporations
D. STARBUCKS EVERYWHERE!!!
D. Franchises
ple of a perfectly competitive market? 2117. Deregulation:
A. agriculture A. is the removal of some government
B. retail controls over a market.
C. tourism B. is used to promote competition
D. cereal C. is followed by an economically healthy
weeding out of some firms from that mar-
2112. Differentiation is ket
A. having identical products. D. All of the Above
B. copying another business.
2118. Which of the following is one of the dis-
C. small differences that make your prod-
advantages of corporations?
uct unique.
A. Limited funds for the company’s
D. having control of the market value.
growth
2113. Monopolistic competition is separated B. Unlimited liability of owners
from pure competition by
C. Limited life of the organization
A. collusion
D. Stricter government regulations
B. profit maximization
C. product differentiation 2119. Which market structure(s) have high
D. imperfect competition barriers for entry
2114. Sellers are price takers in a perfectly
competitive market. B. Perfect competition
A. True C. Oligopoly
B. False D. Monopoly

2120. A 5% rise the price of beef decreased 2125. Restaurants in Tucson are part of which
quantity of beef demanded by 10% and market structure?
increase the quantity demanded of chicken

A. Monopoly
by 15%(i) Calculate the cross elasticity of
demand between beef and chicken B. Oligopoly
A. 1/3 C. Monopolistic Competition
B. 3 D. Perfect Competition
C. 2
2126. Lots of barriers to entry
D. 1/2
A. Oligopoly
2121. Which of these is the best example of B. Monopoly
an externality?
A. You decide to stop snacking between
meals. D. none of above
B. You enjoy looking at your neighbor’s 2127. What are the TWO conditions the PER-
garden. FECT COMPETITON market structures need
C. Your shoe store stops selling your fa- to meet to operate in the industry?
vorite style.
A. Allocative efficiency
D. Your new bicycle goes faster than ex-
B. Scarcity
pected
C. productive efficiency
2122. The MOST LIKELY reason for an en-
trepreneur to start a new business is D. economic profit
A. to make a profit. 2128. Market has many sellers and fair prices
B. to risk financial failure. A. Oligopoly
C. to create a new social benefit. B. Monopoly
D. to discover a new product. C. Perfect Competition
2123. The most important decisions in a corpo- D. none of above
ration are made by
A. the founders of the company 2129. Aria, Michael, and Benjamin are running
separate lemonade stands in a perfectly
B. the stockholders. competitive market. What is each of their
C. the board of directors. goals?
D. the investors. A. To maximize their stand’s influence in
the market
2124. Monopoly=
B. To collude with other lemonade stands
A. one seller
C. To minimize the cost of lemons and
B. Barriers to entry sugar
C. no product differentiation D. To earn as much profit as possible
D. very competitive from their lemonade sales

2130. Which of the following is a result from C. devised oligopoly

having a multi-national company? D. natural monopoly
A. introduce new technology
2136. A formal agreement to set prices or to
B. generate jobs otherwise behave in a cooperative manner
C. produce tax revenue for host countires A. non-price competition
D. all of the above B. collusion
C. deregulation
NARAYAN CHANGDER
2131. Price movements at Disequilibrium
when there is a surplus ? D. All the above
A. Contraction along Demand & Supply
2137. The monopoly market structure is the
B. Expansion along Demand, Contraction opposite of the perfect competition market
along Supply structure.
C. Contraction along Demand, Expansion A. True
along Supply B. False
D. Expansion along Demand & Supply
2138. All are ways to raise money to start a
2132. Which of the following is a government business except
allowed monopoly? A. Savings
A. airline industry B. Borrow
B. utility industry C. Issue Stocks
C. oil production D. Win the Lotto
D. wheat production
2139. Market structure having all conditions
2133. This type of business is owned by one of pure competition except for identical
person. products
A. corporation A. Oligopoly
B. sole proprietorship B. Purely Competitive
C. Monopoly
2134. Walt Disney Company owns other com-
panies; such as magazines, radios, and re- D. Monopolistic competition
sorts. What sort of company is this? 2140. Choose all advantages of a monopoly?
A. sole proprietor A. it has zero competition
B. non-profit B. It has low barriers to entry
C. partnership C. It makes excessive profits
D. conglomerate D. It carries out large scale production
2135. A utility (ex. a power company) which 2141. Reagan buys stock in Nick’s company.
controls all services in a designated area Which is true?
is called? A. They are both owners.
A. trust B. Neither of them have to pay taxes on
B. cartel dividends.

C. Reagan has unlimited liability; Nick

has limited liability.

D. If Nick dies, the company has to close.
2142. What is perfect competition?

A. Perfect competition is a market struc-
ture where there are few buyers and sell-
ers, heterogeneous products, imperfect
information, high barriers to entry or exit, A. Multinational
and individual firms have control over the B. Conglomerate
market price.
C. Vertical Mergers
B. Perfect competition is a market struc-
D. Horizontal Merger
ture where there are many buyers and
sellers, differentiated products, limited in-
2145. What are the characteristics of monopo-
formation, high barriers to entry or exit,
listic competition?
and individual firms have control over the
market price. A. Monopolistic competition is a market
structure in which there are many firms
C. Perfect competition is a market struc-
selling identical products.
ture where there are few buyers and sell-
ers, homogeneous products, perfect infor- B. Monopolistic competition is a market
mation, no barriers to entry or exit, and structure in which there are few firms sell-
individual firms have control over the mar- ing identical products.
ket price. C. Monopolistic competition is a market
D. Perfect competition is a market struc- structure in which there are many firms
ture where there are many buyers and selling differentiated products.
sellers, homogeneous products, perfect D. Monopolistic competition is a market
information, no barriers to entry or exit, structure in which there is only one firm
and no individual firm has control over the selling a product.
market price.
2146. Which of the following is not a charac-
2143. Economists define market structure teristic of a perfectly competitive market?
according to four main characteris-
tics:number of producers, similarity of A. No individual firm is large enough to af-
products, ease of entry, and fect the market price.
A. brand loyalty. B. An individual firm can increase its prof-
its by raising its price
B. control over prices.
C. There are low barriers to entry in the
C. monopolistic competition.
market
D. perfect competition.
D. Each firm sells a product that is es-
sentially identical to its competitors’ prod-
2144. A is a major corporation that in-
ucts.
cludes a number of smaller companies that
produce totally unrelated goods and ser- E. Individual firms have no incentive to
vices. advertise

2147. If a single diner in a tiny rural Florida 2150. A cost or benefit that arises from pro-
town is charging a price for its pancakes duction or consumption of a good or ser-
where the demand is unit elastic, its vice that falls on someone other than the
marginal revenue for pancakes is producer or consumer
A. zero. A. Public goods
B. maximized. B. Externality
C. undefined.
NARAYAN CHANGDER
D. Consumer Goods
D. negative.
2151. In this market, entry is difficult due to
E. positive.
high costs, but not impossible:
2148. Which market structure is works the A. Perfect competition
best, based on:price, efficiency produc- B. Monopolistic competition
tion?
C. Oligopoly
D. Monopoly
2152. Which is NOT a characteristic of monop-
olistic competition?
A. Few sellers and many buyers
B. Similar but differentiated products
C. Limited control of prices
D. Freedom to enter/exit market
2153. Consumers have more choice in an
A. monopoly Oligopoly than in Monopolistic Competi-
B. oligopoly tion
C. perfect competition A. true
D. monopolistic competition B. false

2154. This firm
2149. When companies cut their prices very
low to win business, this can start a(n)
(a), which can be great for consumers but
harmful for producers. But when members
of a(n) (b), agree among each other to ille-
gally set prices, this is considered (c) . An
outcome of this “agreement” is called (d)
where firms agree to sell products at the
same or very familiar price.
A. is earning a per unit profit and its so-
A. a price war cial quantity is greater than the profit max-
imizing quantity
B. b oligopoly
B. is earning a per unit loss and its social
C. c collusion
quantity is greater than the profit maximiz-
D. d price fixing ing quantity

C. is earning a per unit profit and its PM B. imperfect knowledge

quantity is greater than the social quantity C. mutual interdependence

D. is earning a per unit loss and its PM D. homogeneous product
quantity is greater than the social quantity
E. This firm is earning an economic profit 2159. If the firm produces Q2 the firm
and its PM quantity is the same as its so- maximizing its profit and is
cial quantity
2155. One single firm controls the entire indus-

try.
B. Pure Monopoly
D. Oligopoly A. is; earning a normal profit.
2156. In this market structure, a business can B. is not; incurring an economic loss.
offer low quality goods due to lack of com- C. is not; earning a normal profit.
petition
D. is; incurring an economic loss.
A. Monopoly
E. is; earning an economic profit.
B. Oligopoly
C. Monopolistic Competition 2160. Perfect competition is characterized by
all of the following EXCEPT
A. Well-informed buyers and sellers
2157. What is the difference between a B. A small number of buyers and sellers
monopoly and a perfect competition?
C. Identical products
A. Monopolies have no control over
prices and have free entry and exit of D. none of above
firms. 2161. A GDP deflator less than 1 indicates
B. Monopolies and perfect competition that an economy has experienced:
have the same control over prices and out-
A. inflation.
put.
B. deflation.
C. Perfect competition has control over
prices and can restrict output, while mo- C. stagflation.
nopolies have no control over prices and D. none of above
have free entry and exit of firms.
2162. An Oligopoly is when there are
D. Monopolies have control over prices
and can restrict output, while perfect com- A. few producers who control the market
petition has no control over prices and has B. only one producer
free entry and exit of firms. tagsSSEMI3
C. an open market with plenty of produc-
2158. Which of the following characteristic is ers
unique to an oligopoly? D. a market that hasn’t yet been discov-
A. high barriers to entry ered

2163. The demand curve for MONOPOLISTIC

COMPETITON will be
A. highly inelastic
B. highly elastic
C. perfectly inelastic
D. perfectly elastic
NARAYAN CHANGDER
2164. Which of the following markets is an ex-
ample of a monopolistic competition? A. more than he would at a price of $3
A. Phone carriers B. some, but fewer than he would at a
B. Farmers price of $3
C. just as many as he would at a price of
C. Airline industry
$3
D. Dry cleaners D. none
2165. What is a Government Monopoly? E. more info is needed about the prices
charged by other shops
A. a monopoly that has NO government in-
put 2169. Which market structure is controlled by
a few companies at the top?
B. a monopoly created by the government
A. Pure Competition
2166. What is the formula for Total Cost (TC) B. Monopolistic Competition
in the short run?
C. Oligopoly
A. TC = TFC + MC D. Monopoly
B. TC = TFC + TVC
2170. What characteristics are true of an
C. TC = TFC oligopoly (2 are correct)
D. TC = TVC A. few large firms
B. high entry and exit costs
2167. United States Postal Service is an exam-
C. all products are identical
ple a monopoly.
D. no price control
A. natural
B. geographical 2171. Theoretical market structure that re-
quires three conditions:very large num-
C. technological bers, identical products, and freedom of
entry and exit
D. government
A. Oligopoly
2168. If the ice cream industry is perfectly B. Purely Competitive
competitive with a market price of $3 per
bar, and Sigalow’s Sweets charges, $3.50 C. Monopoly
per bar, how many bars will Sigalow sell? D. Monopolistic competition

2172. Fill in the blank. Income Elasticity of De- 2175. What is an advantage of a limited liabil-
mand is the responsiveness of quantity de- ity partnership vs. a general partnership
manded to a change in

A. Business involvement
A. Price B. Investment in the business
B. Income C. limited liability
C. Quantity Supplied D. They don’t have any
D. Equilibrium 2176. In perfect competition, a firm maximizes
profit in the short run by deciding
2173. Government monopoly
A. what price to charge
A. monopoly created and or owned by the
government B. whether or not to enter a market
B. the exclusive legal right, given to an C. how much output to produce

originator or an assignee to print, publish, D. none of above
perform, film, or record literary, artistic,
or musical material, and to authorize oth- 2177. A market structure characterized by a
ers to do the same. single seller dominating all production of a
given good
C. market structure in which the average
costs of production are lowest when all A. Oligopoly
output is produced by a single firm B. Monopoly
D. a government authority or license con- C. Perfect Competition
ferring a right or title for a set period, es- D. none of above
pecially the sole right to exclude others
from making, using, or selling an inven- 2178. Upsilon Natural Gas, Inc. is a monopoly
tion. enjoying very high barriers to entry.Its
marginal cost is $40 and its average cost
2174. Fast food restaurants are an example of is $70. A recent market study hasdeter-
mined the price elasticity of demand is 1.5.
The company will most likelyset its price
at:
A. $40.
B. $70.
C. $120.
D. none of above
2179. What is it when you have factors that

make it difficult for a business to enter a
market?
A. differentiation. A. Economies of Scale
B. monopolistic competition. B. Differentiation
C. pure / perfect competition. C. Cartel
D. monopolies. D. Barriers of Entry

2180. Which type of the following competition B. new laws are created to help govern
firms are considered as a price taker? market conditions.
A. Monopolistic C. a small number of companies domi-
B. Oligopoly nate a market.
C. Perfect Competition D. companies obtain government funding

to market new products.
D. Pure Monopoly
2186. Which federal regulatory agency was
NARAYAN CHANGDER
2181. Ramon decided to open his own soft- established after the Great Recession of
ware business. He borrowed money from 2008-2009?
a bank to buy computers and office equip-
A. FDIC
ment, and he hired one assistant. What
is one DISADVANTAGE of Ramon’s type of B. SEC
business organization? C. ICC
A. limited liability D. CFPB
B. ease of start-up
C. flexibility example of a monopoly?
D. unlimited liability A. utilities/water
2182. For a monopolist, B. department stores
A. its marginal revenue is less than price. C. auto industry
B. existing economic profits can be sus- D. commercial airlines
tained over time.
2188. All of the statements below character-
C. its demand curve is downward sloping. ize both perfectly competitive and monop-
D. all of the above are true. olistically competitive markets EXCEPT:
A. Price is equal to average revenue.
2183. In monopolistic competition there are
many buyers and sellers B. Individual firms produce output where
marginal cost equals marginal revenue.
A. True
C. Firms can affect the selling price of
B. False
their product.
2184. If competition is inconvenient and im- D. The market has a large number of
practical, what kind of monopoly tends to firms.
develop?
E. Firms can easily enter or exit the mar-
A. natural monopoly ket.
B. geographic monopoly 2189. Which market structure has the highest
C. technological monopoly level of competition?
D. government monopoly A. Monopoly
2185. Anoligopolyis a market structure in B. Oligopoly

which C. Monopolistic competition
A. a single company dominates a market. D. Perfect competition

2190. Which of the following is an example of 2195. Which market structures have some
a geographic monopoly? product differentiation? (pick 2)

A. Target in NYC A. Monopoly
B. One grocery store in a small desert B. Oligopoly
town
C. Apple store in Chicago
D. none of above
2196. Does the second market structure in
2191. What type of business organization has question #2 operate as an incorporated or
the most sales in the United States? unincorporated entity?
A. Incorporated
B. Unincorporated
2197. A natural monopoly is one that arises

from
A. Sole proprietorships
B. Partnerships
C. Corporations
D. Nonprofits
2192. All resources people make and use to

produce and distribute goods and services
A. Capital
A. ownership of a natural resource.
B. Monopoly
B. one firm buying all of a natural re-
C. Commodity source.
D. none of above C. patent law.
2193. Below are the characteristics of PER- D. economies of scale.
FECT COMPETITION
2198. A Dollar General opens up on the side
A. price makers of a mountain. Since there are no other
B. price takers stores around it, they are a monopoly in
C. many small firms the area. What type of monopoly is this?
D. low barriers A. Geographical

E. homogeneous product B. Technological
C. Natural
2194. Which of the following is NOT a charac-
teristic of perfect competition? D. Government
A. Many small sellers 2199. Products are not differentiated in
B. Perfect resource mobility Oligopoly
C. Homogeneous product A. true
D. Low barriers to entry B. false

2200. Natural Monopoly is 2204. Which of the following is a form of prod-

uct differentiation?
A. 25-75 firms selling slightly differenti-
ated products; some price control; low A. Flame grilling a burger
barriers to entry B. Adding a “secret” sauce
B. a market that runs most efficiently C. Using a sesame seed bun
D. All of these
chaos 2205. Negative externalities can be best de-
NARAYAN CHANGDER
scribed as
2201. When companies will compete through
A. When the consumption/production of
ways other than lower prices such as
a good or service has a negative impact
physical Characteristics-offering a differ-
on a third party
ent color, size, shape, texture, or taste,
better location-where they know they B. When the consumption/production of
have less competition, differing service a good or service has any impact on a third
levels, and advertising, image, or status. party
A. Nonprice competition C. When the consumption/production of
a good or service has a positive impact on
B. price competition a third party
C. differentiation D. When the consumption/production of
D. NONE of these a good or service depletes the access for
a third party
2202. What’s the boy’s name?
2206. Which market structure includes airlines
and supermarkets
C. Oligopoly
D. Monopoly
A. Alfie 2207. Which is NOT an example of non-price
competition?
B. Freddie
A. location
C. Connor
B. bargaining
D. Kevin
C. service level
2203. If you earn money by allowing people D. advertising
to park their car on your property during
E. status
the fair, it is considered a(n)
A. Monopoly 2208. There is Collusion when firms act to-
gether to reduce output and keep prices
B. public good high.
C. negative externality A. True
D. Positive externality B. False

2209. What are the types of market struc- 2214. Michaela starts a business making video
tures? games. She invests all of her savings and
hires Haylie to help with design. At the

A. monopsony, duopoly, oligopsony, and
syndicate end of the year, Haylie insists on half of
the profits. Which is true?
B. perfect competition, monopolistic com-
petition, oligopoly, and monopoly A. Don’t choose me
C. monopsony, duopoly, cartel, and syndi- B. Michaela & Haylie are stockholders
cate and receive a dividend check.
D. perfect competition, monopolistic com- C. Michaela & Haylie are partners and
petition, oligopoly, and monopsony split the profits evenly.
2210. A market in which there are many pro- D. Michaela is a sole proprietor and
ducers that produce identical products? Haylie is an employee so Michaela does
not have to share her profits with Haylie.
B. monopoly 2215. A market structure with low entry bar-
riers and many firms selling products dif-
ferentiated.
D. oligopoly
A. Monopoly
2211. A situation in which the market fails to B. Oligopoly
allocate resources efficiently
A. Market Failure
B. Market Structure
E. Barriers to entry
C. Public Goods
D. Market Allocation 2216. In order for a firm to engage in price dis-
crimination, it must be:
2212. NPF-BHP gets exclusive rights to ship
iron ore to China. What curve/s is/are im- A. producing in the inelastic portion of its
pacted in the RIO share market and how? demand curve to raise its price and in-
crease total revenue
A. Demand Left
B. a price taker
B. Demand Right
C. able to separate consumers into differ-
C. Supply Left
ent groups
D. Supply Right
D. experiencing economies of scale in the
2213. SSEMI3 Corporations pay corporate in- relevant range of production
come tax. Also, shareholders are taxed
on dividend income (or on sales of shares). 2217. The airline industry is most likely in the
This is called: market structure called
A. The cost of doing business A. perfect competition
B. double taxation B. oligopoly
C. articles of partnership C. monopolistic competition
D. limited liability D. monopoly

2218. a series of competitive price cuts that B. Perfectly elastic

lowers the market price below the cost of C. price insensitive
production
D. Unit elastic
A. price war
B. price fixing 2224. Which market structure is BEST indi-
cated by the soda market?
A. monopoly
D. price gouging
NARAYAN CHANGDER
B. pure competition
2219. The government setting a tariff or C. oligopoly
restriction on a foreign product(import)
D. natural monopoly
leads to
A. Price rises. 2225. Coca Cola
B. Price drops.
2220. occurs when businesses work together

to set prices of competing products
A. price fixing
B. price taker
C. price maker
A. monopoly
D. market allocation
2221. Most recently (Oct 2020) the US Justice
C. oligopoly
Department is bringing suit against for
anti-trust violations, even though, really, D. perfect competition
this firm just makes a product people re-
2226. The public power company is an exam-
ally like a lot.
ple of which market structure?
A. Amazon
B. Google B. monopoly
C. Oracle C. oligopoly
D. Nabisco D. perfect competition
2222. Which of the following examples repre- 2227. In monopolistic competition, what hap-
sents a pure monopoly? pens if the price difference between two
A. Autos brands becomes large?
B. Restaurants A. Consumers become more loyal to their
preferred brand
C. Wheat Farmers
B. Consumers switch to a different mar-
D. Public Utilities
ket structure
2223. In a perfectly competitive market the C. Consumers stop buying the product
goods being sold are D. Consumers are more likely to substi-
A. perfectly inelastic tute one brand for another

2228. What is the term when two companies 2233. Which is NOT a characteristic of an
combine resources and become one giant oligopoly?
company?

A. Many sellers, few buyers
A. merger
B. reinvestment B. Standardized or differentiated prod-
ucts
C. monopoly
D. regulatory C. More control of prices
2229. In perfect competition who is not in- D. Little freedom to enter/exit market
volved at all
A. Government 2234. In 1914, the government passed the
Clayton Antitrust Act to outlaw the sale of
B. Sellers
the same product to different consumers at
C. Buyers different prices, a practice known as
D. Goods
A. cease and desist
2230. An agreement among firms to charge
the same price is called B. economies of scale
A. royalties C. price discrimination

B. price war D. restraint intervention
C. price fixing
D. differentiation 2235. Which of the following does NOT repre-
sent the Price Searchers market?
2231. If every consumers needs are being met
perfectly and every good that is being A. Perfect Competition
made is being sold, what type of efficiency
is being achieved? B. Monopolistic Competition
A. Productive Efficiency C. Oligopoly
B. Allocative Efficiency
D. Pure Monopoly
2232. The cartel model of oligopoly predicts
that 2236. A copyright or patent is an example of
A. all firms in the industry act in unison to a monopoly.
set monopoly price
A. Technological
B. each producer acts independently of
others B. Natural
C. firms follow the low-price firm in the
C. Government
industry
D. differences in cost of production dis- D. Geographic
courage individual firms from cheating
E. the markup on marginal cost should be 2237. *Apartment dwellers who buy fire
the same for all firms alarms or fire extinguishers?

A. Competition
B. Supply and Demand
C. Government Regulation
D. The invisible hand of the free market
2242. An automobile manufacturer that buys

a baseball team.
NARAYAN CHANGDER
A. Horizontal
B. Vertical
C. Conglomerate
D. none of above
A. Negative externality 2243. Which of the following statements is
B. Positive externality the most appropriate description of gross-
domestic product (GDP)?
2238. A major characteristic of a monapoly is A. The total income earned by all house-
A. it is a price maker holds, firms, and the governmentwhose
B. it is a price taker value can be verified
C. there are 2 sellers of a product B. The total amount spent on all final
goods and services produced within the
D. there are a few sellers economy during a given period
2239. An advantage of a corporation is that C. The total market value of resalable and
A. owners pay fewer taxes than owners final goods and services producedwithin
of other forms of business. the economy during a given period
B. the business is subject to little govern- D. none of above
ment regulation. 2244. Does patent laws encourage monopoly?
C. owners have limited liability for debt. A. yes
D. owners have direct and immediate con- B. no
trol over daily management of the busi-
ness. 2245. In this kind of market structure, sellers
don’t have any control over the price of
2240. We discussed whether should be- the products.
come a public utility.
A. Monopoly
A. internet
B. Oligopoly
B. electricity
C. sewage
D. recycling
2246. When the revenue is equal to price,
2241. **Let’s see how close we paid atten- which types of market structure?
tion** In cases of monopolies-such as util-
ity companies-prices are kept under con- A. Competitive monopoly
trol MAINLY through B. Oligopoly

C. Perfect competition 2252. The four basic market structures are:

D. All are types

2247. What company has the smallest percent-
age of sales in the U.S?
B. corporations
C. multinationals
D. partnerships
2248. if a shoe company pays a professional

athlete to wear shoes it makes, it is an
example of: A. multinational, monopolistic competi-
tion, oligopoly, sole proprietorship
A. imperfect competition
B. horizontal merger, vertical merger,
B. product differentiation
multination, oligopoly
C. perfect competition, monopolistic
D. all of these are correct competition, oligopoly, monopoly
2249. Price maker D. perfect competition, vertical merger,
oligopoly, multinational
A. Does not have to consider competition
when setting prices 2253. In which market structure is there the
B. Monopoly MOST competition?
C. Takes the market price
D. Both A and B

the question below. Most common form
of business organizationEasy to startDis-
advantages:Limited access to funds The
above headlines are all examples of A. Monopoly
A. Partnership B. Oligopoly
B. Monopoly C. Monopolistic Competition
C. Corporation D. Perfect Competition
D. Sole proprietorship 2254. Many teenagers in a particular neighbor-
2251. Which structure uses differentiation to hood work as babysitters a few hours a
make its products unique? week. They have different personalities
and degrees of experience. What is the
A. monopoly market structure for babysitting in that
B. monopolistic competition neighborhood?
C. oligopoly A. monopolistic competition
D. pure / perfect competition B. monopoly

C. oligopoly 2259. NPF-The gov’t cuts tariffs on Italian

D. perfect competition espresso machines. What curve is im-
pacted in the cafe market and how?
2255. How is a traditional economy different
A. Demand Left
from a market economy?
B. Demand Right
A. A traditional economy makes what con-
sumers want, but at a much lower price C. Supply Left
than a market economy. D. Supply Right
NARAYAN CHANGDER
B. A traditional economy produces what
2260. An agreement by a formal organization
people need to survive, but production in a
of producers to coordinate production and
market economy is driven by consumerde-
prices, is know as
mand.
A. Price War
C. A traditional economy is based on sup-
ply and demand, while a market economy B. Cartel
is based on customs and survival needs. C. Franchise
D. A traditional economy is driven by con- D. Economies of scale
sumer demand, while a market economy
is driven by the government. 2261. There are many buyers AND sellers in
this market structure.
2256. Price leadership small sellers follow
the price changes of the biggest sellers
C. Oligopoly
D. Monopoly
2257. a business organization owned and con- A. monopoly
trolled by one person B. monopolistic competition
A. sole proprietorship C. oligopoly
B. corporation
D. pure/perfect competition
C. franchise
2262. Are price takers
D. partnership
2258. What are the four different types of
market structures?
C. Oligopoly
A. perfect market, oligarchy, monopoly,
and monopolistic D. Monopoly
B. perfect competition, imperfect compe- 2263. A commercial bank buys a credit union.
tition, monopolistic, and perfect market
A. Horizontal
C. Perfect competition, monopolistic,
oligopoly, and monopoly B. Vertical
D. oligarchy, monopoly, imperfect compe- C. Conglomerate

tition, and socialism D. none of above

2264. Suppose that company XYZ produces an D. Perfect competition has high fixed
undifferentiated product in a single plant in costs, monopolistic goods do not
a highly competitive market. The price is

determined by market factors like demand 2268. Which market has no competition?
and supply. A. perfect competition
A. monopoly B. oligopoly
B. monopolistic competition C. monopoly
C. oligopoly D. monopolistic competition
D. perfect competition 2269. A market where brand-name loyalty is
2265. Which market structure is a price maker more important than product differentia-
or price setter? tion.
A. oligopoly A. Perfect Competition
B. monopolistic competition B. Pure Monopoly
C. monopoly C. Monopolistic Competition
D. perfect competition D. Oligopoly
2266. Which of the following is NOT a condi- 2270. In order to sell more of its product, a
tion for a perfect market? monopolist must
A. A large number of buyers and sellers A. lobby the government for a subsidy
B. Buyers and sellers deal in identical B. lower its price
products C. advertise
C. Each buyer and seller acts indepen- D. enact barriers to entry in related mar-
dently kets
D. Buyers and sellers are reasonably well 2271. What is it called when the government
informed removes a law or restriction?
E. Buyers and sellers must stay in their A. Regulation
business unless authorized by the govern-
ment to get out of that markets-ace B. Deregulation
2267. What is the difference between perfect 2272. If a per-unit tax is imposed on a monop-
competition and monopolistic competition? olist, how will the monopolists marginal
cost curve, output, and the price paid by
A. Perfect competition has a large num-
consumers be affected?
ber of firms monopolistic competition
does not
B. In perfect competition firms produce
identical goods while in monopolistic com-
petition firms produce slightly different
goods.
C. Perfect competition has high barriers
to entry, while monopolistic competition A. A
does not B. B

C. C not allow you to make your own business

D. D decisions by yourself.Only in a sole propri-
etorship can a single person make all deci-
E. E sions, but that person is also responsible
2273. What is a corporation? for all liability.
A. A corporation is a legal entity that is 2277. In a general partnership,

separate and distinct from its owners. A. the business continues even if one
partner dies
NARAYAN CHANGDER
B. A corporation is a type of animal.
C. A corporation is a type of fruit. B. partners must pay specific business
taxes on stock they issue
D. A corporation is a type of building.
tagsSSEMI3 C. partners usually draw up legal papers
called articles of partnership.
2274. Which of the following is the most
D. partners are only liable for the busi-
accurate statement about collusion by
ness’ debt up to the amount of their invest-
oligopolies?
ment
A. Oligopolies do not display mutual inter-
dependence 2278. Firms in a Monopolistic Competition
Market are price takers
B. Each oligopolist’s revenue, cost, and
demand curve can influence the others A. true
C. Oligopolies produce more when they B. false
collude 2279. A form of legal organization in which a
D. none of above business association made up of two or
more persons is formed for the purpose
2275. Business owners face unlimited liability carrying on as co-owners is referred to as
for business debts in: a
A. a corporation
B. a partnership, but not in a sole propri-
etorship
C. a sole proprietorship, but not a part-
nership
D. both a sole proprietorship and a part- A. Sole Proprietorship
nership B. Corporation
2276. In a you can be your own boss, but C. Monopolistic Competition
also have personal liability. D. Partnership
A. Corporation / unlimited 2280. Which of the following best defines a
B. Sole proprietorship / unlimited monopoly?
C. Partnership / limited A. A market where a single individual
D. Sole proprietorship / limited owns all of the companies in the market.
Explanation:Sole proprietorships and gen- B. A market where a single entity is large
eral partnership have unlimited personal enough to set prices without impacting de-
liability.Partnerships and corporations do mand.

C. A market where there are many well- 2285. What is monopolistic competition?
informed buyers and sellers. A. A few companies selling identical prod-

D. A market where one individual owns ucts
companies through the entire distribution B. One company selling several products
line, from raw materials to distribution of under different names
finished goods.
C. Many companies selling similar but
2281. Market structure with a few sellers. NOT identical products
Sometimes they form illegal agreements D. The board game that destroys families
to keep prices high.
2286. Which of the following industries is
A. Monopoly most likely to be regulated by the govern-
B. Oligopoly ment?
C. Monopolistic Competition A. Consumer products
B. Electrical services
C. Dry cleaning
2282. The cookie market includes all bakeries, D. Precious jewels
companies, and independent bakers all
selling similar products with different fla- 2287. What are the responsibilities of an en-
vors. trepreneur?
A. They assume risk.
B. They recognize an opportunity.
C. They test their product or service in a
local market.
D. They gather the resources they need
to go into business.
A. Pure Perfect Competition E. All of the above.
2288. These ar legal restrictions on how high
C. Oligopoly or low a market price may go:
D. Monopoly A. equilibrium
B. shortage
2283. Which agency has the authority to issue
“cease and desist” orders? C. surplus
A. FDIC D. price controls
B. FTC E. price ceiling
C. FERC 2289. In the 1950s in the United States, the

car industry was dominated by GM, Ford
D. EPA and Chrysler. This is an example of:
2284. When a consumer is willing to buy a A. A monopoly
good or service. B. Monopolistic Competition
A. elasticity C. Perfect Competitio
B. demand D. An oligopoly

2290. The type of organization that generates 2294. For price discrimination to take place, a
the most money is market must meet these three conditions:
A. Corporations A. All firms sell the same product; cus-
tomers can be divided into groups; there
B. Partnerships
are no barriers to entry.
C. Franchises
B. Firms have market power; customers
D. Cooperatives can be divided into groups; buyers can’t
resell the product or service
NARAYAN CHANGDER
2291. Which of the following is not typical out-
C. All firms sell the same product; cus-
come of collusion?
tomers can be divided into groups; buyers
A. Price tends to be higher in the entire can easily resell the good or service
industries for consumers
D. none of above
B. Competition is removed from the mar-
ket 2295. Government regulations exist to dis-
courage monopolies in the U.S. economy.
C. There is an incentive to cheat to in-
crease your own profits A. True
D. It occurs in a perfectly competitive B. False

market 2296. Firms in this kind of market produce
E. It occurs in an oligopoly only goods that are very close substitutes.
2292. Charlie’s Cappuccinos, Melia’s Mocha,
and Jared’s Java have agreed to collude B. Pure Monopoly
and act like a monopoly by setting a price C. Monopolistic Competition
of $ 5 per cup of coffee.What is the most
D. Oligopoly
likely outcome?
A. At least one firm will exit the industry 2297. Which market structure is made up of a
few large firms?
B. Industry profits will stay the same in
the long run A. Perfect Competition
C. Industry profits will be higher in the
long run C. Oligopoly
D. At least one firm will violate the agree- D. Monopoly
ment and raise its price
2298. Which of the following is not a public
E. At least one firm will violate the agree- good?
ment and lower its price
A. national parks
2293. This type of market is the easiest to en- B. highways
ter. C. city libraries
A. Monopoly D. shopping malls
2299. A merger involving 4 or more unrelated
C. Monopolistic Competition companies
D. Oligopoly A. horizontal

B. vertical B. TAKER
C. conglomerate
2305. Market failure occurs whenever

D. none of above
A. free markets fail to distribute re-
2300. “obstacles or hindrances that make it sources efficiently.
difficult for new companies to enter a
B. goods fail to arrive at a market in a
given market may include technol-
timely fashion.
ogy challenges, government regulations,
patents, start-up costs, or education and C. government builds infrastructure.
licensing requirements.”Which characteris- D. voluntary exchange in a market fails to
tic of a market is the quote describing? result in a sale.
A. price control
B. barriers to entry 2306. It is a market structure where there is
only one seller and there are many buyers.
C. amount of competition
D. number of sellers
B. monopoly
2301. To determine whether an industry is an
oligopoly, economists measure C. oligopoly
A. increases in the price of goods D. monopolistic competition

B. concentration of market share 2307. are a percentage of earnings paid by
C. product differentiation franchises to parent companies.
D. commodity measuring A. Fringe benefits
2302. Monopolistic competition is different B. Salaries
from pure competition in that C. Investments
A. sellers control the price of their prod-
D. Royalties
ucts.
B. people have no choice in what to buy. 2308. Businesses like car or cereal manufactur-
C. new sellers cannot enter the market. ers
D. sellers have products which are a little A. Oligopoly
different B. Perfect Competition
2303. Which of the following is NOT a feature C. Monopoly
of a monopolistic competition?
A. Numerous sellers
B. Product differentiation 2309. Products that are the same no matter
who produces them
C. Numerous buyers
D. Homogenous price A. Homogeneous products
B. Grade
2304. A firm in monopolistic competition is a
price C. Differentiated products
A. MAKER D. Market structure

2310. The profit maximizing price and quan- A. A

tity are: B. B
C. C
D. D
E. E
NARAYAN CHANGDER
ple of a perfectly competitive market?
A. Athletic shoes
A. Q1; P6 B. Diamonds
B. vomiting; squirt
C. Farming
C. Yaz; Pch
D. Soft drinks
D. Yach; Pz
E. qq; Pa 2314. Which type of business model does not
seek financial gain, but rather looks after
2311. When Gillette Co. unveiled Mach3, the the interests of their consumers?
world’s first triple-blade razor, it took a A. multi-national
bold gamble Mach3 cartridges were to
sell for around $1.60 each. Skeptics pre- B. non-profit
dicted the personal-care giant would soon C. monopoly
be forced to cut that price. But the price is
D. co-operative
holding and Mach3 has become the No. 1
blade and razor. What’s the secret to pric- 2315. There are many substitute products
ing power? For starters, a commitment to available to choose from in a monopolistic
innovation. Gillette spent nearly $1 bil- market structure.
lion on the development and initial mar-
A. True
keting of Mach3. Based on the passage,
what type of monopoly is helping Gillette B. False
Co. maintain a high price for its Mach3 ra-
zor? 2316. Which market structure has the lowest
barriers of exit and entry?
A. Natural monopoly
B. Technological monopoly
C. Geographic monopoly
C. Oligopoly
D. none of above
D. Monopoly
2312. Which relationship between marginal
revenue and price under monopolistic com- 2317. A market structure where a few large
petition and perfect competition is correct? firms dominate.
A. monopoly
B. oligopoly
C. twisted
D. fridgeopoly

2318. What company has the highest percent- 2323. Describe the four features of monopolis-
age of net income in the U.S? tic competition

A. sole proprietorship A. Large number of firms, identical prod-
B. corporations ucts, no market power, no barriers to en-
try or exit.
C. multinationals
D. none of above
entiation, some market power, some bar-
2319. What is the biggest benefit of co- riers to entry or exit.
operatives? C. Only a few firms, product differentia-
A. cheaper prices tion, lots of market power, high barriers
B. more profit to entry or exit.
C. less options to choose from D. Only one firm, no need for product
D. more options to choose from tremely high barriers to entry and exit
2320. FEW SELLERS DOMINATE THIS MARKET
2324. When a given firm has more market
A. OLIGOPOLY power than other firms in a given indus-
B. MONOPOLY try this mostly means
C. PURE COMPETITION A. they have more control over the price
of the product sold in that industry
D. PERFECT COMPETITION
B. they have less control over the price of
2321. Occurs when businesses agree to set the product sold in that industry
prices for competing products
C. they can make more of the product
A. Predatory Pricing sold in that industry
B. Market Allocation D. they can make a better quality product
C. Price Fixing sold in that industry
2322. If the monopolist could engage in per- has the disadvantage of paying special
fect price discrimination, the monopolist’s taxes (double taxation)?
total output and the price charged for the A. Sole Proprietorship
last unit of output sold would be:
B. Corporation
C. Partnership
D. Oligopoly
2326. A business that expands their produc-

tion across many countries around the
world is called a
A. Q1 P1 A. multi-national
B. Vomit B. not profit
C. Q1 P2 C. co-operative
D. Fall with me D. monopoly

2327. A decrease in competition within an in- 2331. Using the pizza store graphic, what mar-
dustry often results in ket structure best fits the pizza industry?
A. more efficient resource allocation
B. lower prices
C. a firm wielding economic and political
power
D. increased output
NARAYAN CHANGDER
has a single owner? A. Monopoly
A. Sole Proprietorship B. Oligopoly

B. Corporation
C. Partnership
D. Oligopoly 2332. The farmers’ market is an example of
2329. Whose flag is this? A. a monopoly.

B. a purely/perfectly competitive mar-
ket.
C. an oligopoly.
D. a monopolistic competition.
2333. Short run in the PERFECT COMPETITON

will experience
A. economic profit
A. Russia B. supernormal profit
B. Slovakia C. economic loss
C. Norway D. normal profit
D. Scandinavia 2334. In a command economy, who makes the
decisions about what and how much to pro-
2330. There are many sellers of blue jeans.
duce?
Each blue jean seller makes their product
slightly different to set it apart from oth- A. Individual consumers
ers. There is free entry and exit into the B. Foreign investors
blue jean market. Which market structure
C. Government or central authority
does this describe?
D. Private companies
2335. Which of the following is NOT a condi-
B. Oligopoly
tion for perfect competition?
C. Monopoly
A. Many buyers and sellers participate in
D. Monopolistic Competition the market.

B. Sellers offer a wide variety of prod- 2340. Which assumption states that firms in a
ucts. perfectly competitive market are price tak-
ers?

C. Buyers and sellers are well informed
about products. A. There are a large numbers of both buy-
D. Sellers are able to enter and exit the ers and sellers in the market
market freely. B. The product that each firm produces is
homogenous
2336. The cross elasticity of demand is the per-
centage change in demand for one good C. There is full knowledge of both profits
generated by a percentage change in price and prices
for another good D. There is freedom of entry and exit into
A. TRUE and out of the industry
B. FALSE 2341. Market structure in which only a few

large sellers dominate and have ability to
2337. High barriers to entry and the lack of affect prices in an industry
competition lead to governments usually
A. Oligopoly
regulating prices.
B. Purely Competitive
C. Monopoly
C. oligopoly
D. monopoly 2342. The monopolist’s demand curve is
whereas the perfectly competitive firm’s
2338. Which of the following is most likely to demand curve is
cause the long-run aggregate supply curve
A. always downward sloping; always hor-
to shift to the left?
izontal
A. Higher nominal wages
B. always horizontal; always downward
B. A decline in productivity sloping
C. An increase in corporate taxes C. the market demand curve; the industry
D. none of above demand curve
D. fixed because it represents just one
2339. If the price of a firms variable input in- firm; variable because it is only a fraction
creases, which of the following will occur? of the industry’s demand
A. The firm will decrease its level of pro- E. inelastic along its entire range; unit
duction. elastic along its entire range
B. The price of the good will decrease in
the short run. 2343. In natural monopolies, the price they can
charge is
C. The firms marginal costs will decrease
at every level of output. A. left up to the markets to decide
D. The firms average fixed cost will de- B. controlled by the US government
crease. C. regulated by the Public Utilities Com-
E. More firms will enter the industry in mission
the long run. D. voted on by their stockholders

2344. Which market structure is characterized 2348. The diagram shows the cost and rev-
by a few major companies dominating the enue curves of a firm in imperfect compe-
global market? tition. At which output will the firm pro-
A. Perfect Competition duce if it wishes to make some supernor-
mal profit to satisfy its shareholders and
B. Monopolistic Competition at the same time to allocate resources ef-
C. Oligopoly ficiently?
D. Monopoly
NARAYAN CHANGDER
2345. Which resource is missing from the 4
resources? Material, Human, Information
and
A. Group resources
B. Financial resources
C. Natural resources
D. Microeconomics A. A
2346. Which of the following is a disadvan- B. B
tage of a corporation? C. C
A. Double Taxation D. D
B. Limited Life
2349. These costs are calculate by diving the
C. Unlimited Liability cost by the output
D. Difficult to raise money A. Fixed Cost
2347. Which description fits the total-cost B. Average Cost
curve when the marginal product of labor C. Total Cost
diminishes
D. Variable Cost
2350. Elasticity of demand is greater in the

short-run
A. true
B. false
2351. A market that runs most efficiently

output and enjoys economies of scale is
A. They are linear. known as
B. The slope increases as output in-

creases.
C. The slope decreases as input in-
creases.
D. The curve is a parabolic inverse “u”
that contains a peak.

A. a Natural Monopoly 2357. Water company

B. a Cartel A. Natural monopoly

C. an Oligopoly B. Government monopoly
D. Perfect Competition C. Technological monopoly
2352. are money and other valuables be-
longing to an individual or business. 2358. Choose the correct option
A. Specialization
B. Business profits
C. Equity
D. Assets
2353. The price of petrol/gas is expected to A. 3

increase next week. Then today the de- B. 16
mand for petrol/gas will
C. 4
A. increase
D. 8
B. decrease
2359. The government’s role in encouraging
C. never change competition in the Free Enterprise system
D. meet equilibrium includes all of the following EXCEPT:
A. preventing monopolies
2354. If Facebook and Twitter were to merge
into one, what type of merger would this B. providing public goods such as high-
be? ways and the military
A. horizontal C. ensuring consumers receive accurate

information
B. vertical
D. limiting the number of business that
2355. What market structure does Americans are allowed to open
hate and tried to outlaw them? 2360. Sonic exists in a market where they
A. perfect competition must advertise their differences in addi-
tion to their prices.
B. oligopoly
D. Monopoly
2356. Which of the following is NOT one of the

three questions of economics?
A. What to produce? A. Pure Perfect Competition
B. How to produce? B. Monopolistic Competition
C. For whom to produce? C. Oligopoly
D. When to produce? D. Monopoly

2361. the division of consumers into groups A. Commodity

B. Market
good
A. price discrimination C. Capital
B. market power D. none of above

C. government monopoly 2367. How many minutes are there in a day?
A. 1550
NARAYAN CHANGDER
2362. An industry that is dominated by a few B. 1450
large firms is
C. 1440
A. A competitive market
D. 1420
B. A monopoly
C. An oligopoly 2368. Pure competition and monopoly
D. none of above A. are the same
2363. Gross Domestic Product B. are almost the same
A. increase in prices C. are opposites
B. decrease in prices D. should not be compared
C. total value of all goods and services
produced in a year 2369. As the number of sellers in an oligopoly
grows larger, an oligopolistic market looks
D. gross amount of products imported
more like
and exported
A. a monopoly
2364. Which market structure is most likely to
have high barriers to entry a small group B. a competitive market
controlling most of the market, and firms C. a collusion solution
are Price Searchers?
D. monopolistic market
B. Monopoly 2370. What is the basis of differentiation be-
C. Oligopoly tween market structures?
D. Monopsons A. Price charged to the consumer

B. The efficiency of their operations
2365. What is Imperfect Competition?
A. a market structure in which a large C. The number of firms in the industry
number of firms all produce the same D. The amount of Market Power enjoyed
products by each firm
B. a market structure that does not meet
the conditions of perfect competition 2371. A market that runs most efficiently
when one large firm provides all of the
2366. a tangible good that can be bought and output. It’s inconvenient or impractical
sold or exchanged for products of similar to have several competing firms. Exam-
value ple:Electric company for DR

D. many companies selling a similar, but

different product

2376. The graph shows a(n):
A. Natural Monopoly
B. Monopoly
C. Government Monopoly A. oligopsones
D. Oligopoly B. monopoly
2372. A product that is considered the same C. monopsons
regardless of who makes it, is considered
D. perfectly competitive factor market
a “good”.
and firm
A. True
2377. Which of the following businesses most
B. False
resembles a perfect competition market
2373. What is price discrimination? structure?
A. Requiring all firms to sell the same A. Sally Sari S training
product at the same price in order to in- B. Airline companies
crease competition
C. Electric company
B. The practice of selling the same prod-
uct to different consumers at different D. Telecommunication Company
prices if it lessens competition
2378. Profit maximization is
C. The practice of searching for the best
price for a product A. marginal profit equals marginal rev-
enue
D. Refusing to sell products to specific in-
dividuals B. marginal cost equals marginal rev-
enue
2374. In perfect competition markets, prod-
C. marginal revenue equals profit
ucts are perfectly substitutable for each
other. D. profit equal marginal cost
A. TRUE
2379. the economic value of a worker’s expe-
B. FALSE rience and skills
2375. What is monopolistic competition? A. Human Capital
A. 1 company selling a product B. Resources
B. many companies sell the same product C. Infrastructure
C. a few companies sell the product D. none of above

2380. These are the goods that a firm has on 2384. If the monopoly is producing at the
hand. profit maximizing quantity, what letters
A. inventory indicate the deadweight loss?
B. shortage
C. Intel
D. luxury
NARAYAN CHANGDER
2381. secret agreement or cooperation
A. collusion
B. cartel
C. oligopoly
A. FJH
D. insider trading
B. ABFG
2382. Fill in the blank. Cross Elasticity of De- C. FLH
mand is the responsiveness of quantity
D. FGL
of one good to a change in the price
of another. E. BCGH
A. Supplied 2385. market failure in which there is unin-
B. Demanded tended harm or inconvenience to a third
party.
C. Requested
A. positive externality
D. Bargained
B. negative externality
2383. You are the manager of Fun World, a C. economies of scale
small amusement park that only charges
per ride. The diagram shows the demand D. public goods
curve for a typical customer. At $5 per 2386. What is the ideal market structure?
ride, how much consumer surplus does
each customer get? A. Monopolistic competition
B. Monopoly
C. Oligopoly
2387. The sum of the market share of the four

largest firms in an industry where a ratio
above 40% is good indicator of oligopoly
is called
A. four firm concentration ratio.
A. $5 B. Herfindahl index.
B. $15 C. oligopoly rule.
C. $25 D. profit maximizing industry.
D. $50 E. non-collusive oligopoly.

2388. Which of the following is NOT consid- C. a mixed economy mostly mar-
ered a barrier to entry? ket(capitalism) economy

A. Patents D. none of above
B. Start up Fees
2394. Which type of laws promote competi-
C. Licenses tion by preventing or breaking up monop-
D. Education olies?
A. labor laws
2389. Which is NOT an example of non-price
competition? B. antitrust laws
A. Excellent service C. laws protecting the environment
B. 50% off deal D. constitutional law
C. Attention getting advertisements
2395. The degree to which individuals change
D. Free kids meal with every adult meal their demand/amount supplied in re-
sponse to price or income changes.
2390. The only gas station within a radius of
200 miles has a A. Elasticity
A. geographic monopoly B. Substitute

B. natural monopoly C. Complements
C. technological monopoly D. Incentive
D. none of above 2396. A life insurance company merges with a
major telecommunications company.
2391. Rashaun and Blaine are discussing the
characteristics of a corporation. What A. Horizontal
might you hear them say?
B. Vertical
A. corporate owners have unlimited liabil-
C. Conglomerate
ity
D. none of above
B. corporations have a limited life
C. corporations are like a person 2397. A market structure characterized by
D. corporations are inexpensive and firms producing similar but not identical
quick to start products. (Jeans, Shoes)
2392. True or false:The danger of horizontal
mergers is it could lead to a monopoly B. Monopolistic Competition
A. true C. Oligopoly
B. false D. Monopoly
2393. The U.S. is mostly a 2398. Market structure is the framework

within which a firm sells its
A. centrally planned economy
A. Output
B. a mixed economy mostly socialist
economy B. Products

2399. What city is this? A. Peak

B. Expansion
C. Recession
D. Trough
2404. You have a taco truck to make extra

money on the weekends. Your business li-
cense cost $200, you purchased the truck
NARAYAN CHANGDER
A. Chicago for $6000, you spent $300 for advertis-
ing, the taco ingredients cost $2 per taco,
B. Boston
and you sell your tacos for $5 each. How
C. London many tacos do you need to sell to start
D. Mexico City making a profit?
A. 1975
2400. What item being sold is an example of
an oligopoly B. 2025
A. apples C. 2058
B. socks D. 2167
Explanation:The fixed cost are $6500Truck
C. playstation gaming system
$6000Ads $ 300License 200The variable
D. shoes costs are $2The marginal profit (addi-
tional for each taco) is the $5 price mi-
2401. Economists usually call an industry an
nus the $2 ingredient cost = $3You must
oligopoly if
cover the fixed costs before you start to
A. the four largest firms produce at least make a profit. So divide the fixed costs
70-80 percent of the output. ($6500) by the marginal profit ($3) from
B. only one product is available on the each additional taco sold to find how many
market. you must sell to break even.$6500 / $3 =
2166.67 tacos, so you must sell at least
C. the ten largest firms produce less than
2167 to start making a profit.
50 percent of the output.
D. there is one firm that produces 100 2405. A company bought out every step of the
percent of the output. production process from beginning to end.
They own the production, the transporta-
2402. An example of a natural monopoly is tion of the product, and the stores where
A. company that makes pretzels it’s sold. What is this describing?
B. your local water company A. conglomerate
C. your barber B. horizontal merger
D. a Midwest farm C. vertical merger
2403. Most businesses are producing at or D. partnership

near capacity; the unemployment rate is 2406. Very Competitive Low Prices
very low; and consumer spending is brisk.
Which part of the business cycle best de- A. Oligopoly
scribes these events? B. Monopoly

C. Perfect Competition that were a major cause of the 2008-2009

D. none of above Great Recession

B. To prevent people from borrowing
2407. What is the main difference between money abroad to keep domestic banks
a monopoly firm and a perfectly competi- profitable
tive firm in terms of quantity produced and
price? C. To save the economy from greedy pro-
ducers who offer inferior products at in-
A. Monopoly firm produces more quantity
flated prices
at a lower price
D. To offer alternatives to bank loans,
B. Perfectly competitive firm produces
which will help consumers by keeping
more quantity at a lower price
down the cost of lending
C. Monopoly firm produces less quantity
at a higher price 2412. Natural monopoly
D. Perfectly competitive firm produces A. market structure in which the average
less quantity at a higher price costs of production are lowest when all
output is produced by a single firm
2408. Rubik’s Cubes would be an example of
B. a patent on a new product
A. Perfect Competition C. monopoly created and or owned by the
government
B. Oligopoly
D. a company has a monopoly because of
C. Monopoly
its location
2413. Which type of business organization is
2409. Which market structure involves selling managed by a Board of Governors?
identical products?
B. Partnership
C. Government
C. Oligopoly
D. Monopoly D. Corporation
2410. When two sides listen to suggestions 2414. Market structure

from an objective third party but neither A. market structure having all conditions
side must accept the suggestions of pure competition except for identical
A. mediation products
B. binding arbitration B. classification according to number and
size of firm, type of product, and type of
C. injunction
competition
D. collective bargaining
C. market structure in which the average
2411. Why was the Consumer Financial Protec- costs of production are lowest when all
tion Bureau (CFPB) created? output is produced by a single firm
A. To prevent another situation like the D. market structure characterized by a
millions of low-quality home mortgages single producer in a market

2415. What is called a natural monopoly 2420. A firm in a monopolistic competitive

A. a company that only sells natural re- market will be able to do which of the fol-
sources lowing?
B. a firm that produces the quantity at A. Easy entry into the market
which marginal cost equals marginal rev- B. some ability to raise prices
enue
C. non-price competition
C. a company that can supply goods at a
D. all of the above
lower price than two or more companies
NARAYAN CHANGDER
D. a company that is the sole owner of key 2421. Which of the following is NOT a charac-
resources teristic of perfect competition?
E. producers who minimize average total A. Many buyers and sellers
costs rather than maximize profits B. Sellers offer identical products
2416. Pure oligopoly is based on the prod- C. Sellers can enter and exit the market
ucts. freely
A. Differentiated D. There is control over prices
B. Homogeneous
2422. What is a Monopoly?
C. Unrelated
A. a market dominated by a single seller
D. none of the above of a product
2417. Mergers and acquisitions might result in B. a market dominated by many sellers of
A. More competition a product
B. Smaller companies 2423. A price floor will result in a
C. Unfair competition A. shortage
D. none of above B. surplus
2418. In a perfect competition market struc- C. equilibrium price
ture, when firms join or leave due to
D. equilibrium quantity
barriers to entry, market will
change/shift. 2424. Which of the following is a modern car-
A. high / demand tel?
B. free / demand A. Coca-Cola, Pepsi, and Dr Pepper Snap-
C. high / supply ple Group
D. free / supply B. Microsoft

C. Organization of Petroleum Exporting
2419. Using advertising to try to convince cus-
Countries
tomers to buy one product over another is
a form of D. Standard Oil Company
A. Antitrust competition 2425. There are only certain venues that can
B. Focus competition be considered a market.
C. Monopolistic competition A. True
D. Non-price competition B. False

2426. Which of the following is an advantage C. demand

of monopolistic competition? D. surplus

A. It would be easier and more cost effi-
cient for the government to practice this 2430. The ease of sellers entering the market
market structure. is a factor in any market structure.
B. This market structure will require cre- A. True

ativity and innovation from the sellers. B. False
C. Potential sellers can easily enter the 2431. SSEMI3 b You go to a shoe store at
market since the products are not differ- the mall. The store carries many differ-
entiated. ent brands and styles of shoes. What mar-
D. none of above ket structure would best describe this sit-
uation?
2427. Why do goods made in factories that
cause pollution tend to be overproduced? A. Perfect Competition
A. Some stores stock more than they can B. Monopolistic Competition

sell. C. Monopoly
B. Some costs are not charged to the pro- D. Oligopoly
ducer.
2432. SSEMI3 b This is a market structure in
C. Some benefits are wanted by the com- which a few very large firms dominate the
munity. market for a particular product
D. Some people may refuse to purchase A. Perfect Competition
the items
2428. An economic system in which the gov- C. Oligopoly
ernment makes all economic decisions
D. Monopoly
A. Market
B. Command 2433. If a firm is producing the socially opti-
mal quantity, then what is price equal to
C. Traditional at that point of production?
D. Mixed A. marginal cost (MC)
2429. What does this curve represent? B. marginal revenue (MR)
C. average total cost (ATC)
D. average variable cost (AVC)
2434. If ABM firm sells its output in a market,

with many sellers and buyers of homoge-
neous product, and unlimited resource mo-
bility, the structures is a/an
A. monopolist
B. oligopolist
A. supply C. perfect competitor
B. equilibrium D. monopolistic competitor

2435. All of the following are characteristics B. Fixed costs plus Variable costs.
of perfectly competitive markets EXCEPT C. The additional costs of an additional
A. many sellers unit of output.
B. identical goods D. The costs for variable resources that
C. many buyers change as more or less is produced.
Explanation:Marginal in economics means
D. perfect information “the additional” for one more.Marginal
E. barriers to entry cost is the additional cost of one more unit
NARAYAN CHANGDER
of output.Marginal revenue is the addi-
2436. A market that has a few sellers of basi- tional revenue of one more sale.Marginal
cally the same goods. profit is the profit from one more unit sold.
2441. Forces that reduce a firms per unit cost.
B. Pure Monopoly =)
C. Monopolistic Competition A. economies of force
D. Oligopoly B. economies of scale
2437. Barriers to entry refers to: C. economic equality
A. Is it easy or difficult to enter to leave D. economic inequality
the industry
2442. Which of the following is NOT an advan-
B. The idea that market forces of supply tage of a sole proprietorship?
and demand do not always provide the
A. easy to leave the business
maximum benefit for society
B. easy to start
C. Can a producer or supplier make
prices or do they have to take the prices C. responsible for the acts of others in
the business
D. The amount of locks on the business
premises D. relative ease of management
2438. How is an increase in demand depicted 2443. Collusion between companies on prices
on the demand curve? is what makes cartels illegal in America
A. the curve bends inward A. Perfect Competition
B. the curve straightens up B. Monopolistic Competition
C. the curve slopes upward C. Oligopoly
D. the curve slopes downward D. Pure Monopoly
2439. Purely competitive market is price taker 2444. Which of the following is NOT consid-
while pure monopolist is price maker. ered Product Differentiation?
A. True A. How one company’s smart phone dif-
fers from another
B. False
B. McDonald’s french fries vs Burger King
2440. Marginal cost is french Fries
A. The costs for fixed resources and does C. A company knowing some inside infor-
not change with the amount produced. mation that other companies do not

D. Comparing a Ford pickup truck to a

Chevy pickup truck

2445. Which is an example of a public good?
A. a rock band
B. a car
C. national defense
D. bread A. Surplus of 4, 000
2446. What is a monopoly? B. Surplus of 2, 000
C. Shortage of 4, 000
A. a market structure characterized by a
large number of well-informed indepen- D. Shortage of 2, 000
dent buyers and sellers who exchange
2450. What is Perfect Competition?
identical products
A. a market structure in which a large
B. a market structure that has all the con- number or firms all produce the same
ditions of perfect competition except for product
identical products
B. a market structure in which different
C. a market structure in which a few very products are produced.
large sellers dominate the industry
2451. Museums, public schools, and YMCAs
D. a market structure with only one seller are all
of a particular product
A. exempt from paying taxes.
2447. Apart from each other, Ja’mya, B. completely supported by the govern-
M’Cayla, & Ashlyn own most of the rental ment.
houses in Eastman. Which is true?
C. promoted by trade association
A. The market for rental houses in monop- D. supported by professional organiza-
olistically competitive. tions.
B. The market for rental houses is a
2452. What is the slope of the marginal rev-
monopoly.
enue curve?
C. The market for rental houses is an A. Positive
oligopoly.
B. Negative
D. The market for rental houses is purely
C. Zero
competitive.
D. Depends on the quantity sold
2448. A cartel is an example of perfect compe-
2453. The inventory-sales ratio is most likely
tition.
to be rising:
A. True A. as a contraction unfolds.
B. False B. partially into a recovery.
2449. If the government set the price at $300, C. near the top of an economic cycle.
what would be the result? D. none of above

2454. The term interdependent in oligopoly B. They are inversely related

refers to the fact that C. They have no relationship
D. They are unrelated

A. Car Industry
NARAYAN CHANGDER
B. Al’s Pizza
A. there are barriers to entry. C. Toho Water Authority
B. one firm’s profits are affected by other D. Tim and Javier Lawn Care
firms’ actions.
2459. Which of the following pieces of legis-
C. they definitely compete so that price is lation prohibited unfair business practices,
driven down to the monopoly level. price setting, price discrimination, and set
D. there are too many of them for any one up the Federal Trade Commission to inves-
firm to influence price. tigate unfair business practices.
E. they can produce either identical or dif- A. Interstate Commerce Act
ferentiated goods. B. Clayton Anti-Trust Act
2455. A major characteristics of monopolistic C. Sherman Anti-Trust Act
competition is that prices will be D. Federal Trade Commision
A. higher than perfect competition
2460. Which type of monopoly is allowed to
B. lower than perfect comp exist because it gives an incentive to cre-
C. higher than monopoly ate or improve something?
D. unrelated to comp A. Natural Monopoly
2456. The efficiency of monopolistic competi-
tion C. Government Monopoly
A. depends on whether the gain from ex- D. Technological Monopoly
tra product variety offsets the selling cost 2461. A firm operating in the ? market
and extra cost that arises from excess ca- structure has no market power
pacity.
A. Monopoly
B. is equal to that of monopoly.
B. Oligopoly
C. is as clear cut as the efficiency of per-
fect competition. C. Monopolistic Competition
D. is eliminated in the long run. D. Perfect Competition
E. comes from its excess capacity. 2462. The price charged by a perfectly compet-
itive firm is
2457. What is the relationship between com-
petitive behaviour and competitive market A. higher the more the firm produces.
structure? B. lower the more the firm produces.
A. They are directly related C. the same as the market price.

D. different than the price charged by A. Productive Resources, Goods and Ser-
competing firms. vices
B. Money

E. indeterminate.
C. Taxes
2463. .... is the money a firm receives from
selling its output. D. Imports
A. Cold cash money 2468. Which market offers perfect substitu-
B. Sales tion?
C. Revenue A. Monopoly
D. none of above
2464. What are some example of price discrim- D. Oligopoly
ination? Choose all that apply.
A. Discounted airline fares 2469. The government has these types of laws
to regulate illegal practices of monopolies
B. Milk pricing
A. anti-environmental
C. Manufacturers rebates
B. antitrust
D. Senior citizen discounts C. anti-American
2465. An economic model of competition D. anti-monopoly
among businesses in the same industry is
2470. Perfect competition markets would
called
have the highest barriers to entry.
A. Monopoly
A. TRUE
B. Merger
B. FALSE
C. Market Structure
2471. Henry, Zoe, and William are dis-
D. Sole Proprietorship cussing about different market structures
2466. Setting prices below cost to drive in their Leaving Cert course. Henry men-
smaller companies out of business tioned Perfect Competition, Zoe talked
about Oligopoly, and William discussed
A. Perfect Competition Monopoly. Which of these is NOT a mar-
B. Nonprice Competition ket structure on their course?
C. Predatory pricing A. Perfect Competition
D. Product Differentiation B. Imperfect Competition
C. Oligopoly
2467. The DASHED arrows on this circular flow
diagram represents the flow of D. Monopoly
2472. A technological monopoly involves:
A. Stealing plans from another business.
B. Being the only seller in a small town.
C. Having a patent for a new invention or
scientific process.
D. Having a few sellers in the market.

2473. Monopolies don’t have an incentive to C. Oligopolies and monopolies

increase quality or innovate because D. Monopolies and monopolistic competi-
A. To increase profit tion
B. They need to in order to stay competi-
2479. Rylie doesn’t understand why the mail-
tive
man puts mail in her mailbox, but UPS
C. False, monopolies will continue to in- and FedEx deliver packages to her front
crease cost to make consumers happy porch. The reason for this is because the
NARAYAN CHANGDER
D. They control the market Post Office has a monopoly in regard
to putting objects inside her mailbox.
2474. To be considered an oligopoly, the 4
largest firms must control at least of A. natural
the market. B. technological
A. 30% C. geographic
B. 40% D. government
C. 50%
2480. In the US, gasoline is only produced by
D. 60% 6 major producers. This market is closest
2475. SSEMI3 b Which market structure has to:
the lowest barrier to entry? A. perfect competition
A. Perfect Competition B. oligopoly
B. Monopoly C. monopoly
C. Oligopoly D. monopolistic competition
D. None have a low barrier to entry
2481. a business co-owned by two or more
2476. How many units will consumers demand partners
at a price of $10?
A. 0
B. franchise
B. 200
C. corporation
C. 400
D. partnership
D. 800
2482. What is a characteristic of a perfectly
2477. Windows 10 is an example of a
competitive market?
A. Government Monopoly
A. Many buyers and sellers, homoge-
B. Natural Monopoly neous products, and free entry and exit
C. Geographic Monopoly from the market
D. Technological Monopoly B. Many buyers and sellers, unique prod-
ucts, and no restrictions on entry and exit
2478. Easy for new firms to enter the industry from the market
A. Perfect competition and monopolistic C. Many buyers and few sellers, similar
competition products, and government control over en-
B. Perfect competition and oligopolies try and exit from the market

D. Few buyers and sellers, differentiated 2488. If a company that owns gas stations
products, and restricted entry and exit merges with an oil tanker trucking com-
from the market pany and a refinery it is most likely a

merger
2483. Why do producers create more goods as
A. horizontal
market price increases?
B. vertical
A. to reduce cost
C. conglomerate
B. to increase output
D. none of above
C. to eliminate scarcity
2489. A merger that joins companies that are
D. to earn higher profit at different steps of producing the same
product is called a
2484. Two toy companies decide to merge be-
cause they believe they will be able to de- A. vertical merger.
velop more ideas for new toys and produce B. conglomerate.
and sell them faster, at lower costs. C. horizontal merger.
A. Horizontal D. corporation.
B. Vertical
2490. Which of the following goods is the best
C. Conglomerate example of a natural monopoly?
D. none of above A. lottery tickets
B. cell phones
2485. Which market structure has businesses
that sell identical goods? C. public utilities
A. Perfect Competition D. diamonds
B. Monopolistic Competition 2491. Which of the following is a condition of

C. Oligopoly
A. products produced by rival firms are
D. Monopoly perfect substitutes
2486. Which industry is an example of B. individual firms can affect market sup-
oligopoly? ply
A. Dairy farming C. industry sales are small

D. restricted entry and exit
B. Tomato production
C. Diamond mining 2492. In a general partnership,
D. Car manufacturing A. the business continues even if one

partner dies
2487. Google is an example of a B. partners must pay specific business
A. oligopoly taxes
C. partners usually draw up articles of
B. monopoly
partnership
C. pure / perfect competition
D. partners are only responsible for debt
D. monopolistic competition equal to investment

2493. What is a disadvantage of partner- B. Oligopoly

ships? C. Monopolistic Competition
A. ease of formation D. Perfect Competition
B. owners share responsibilities
2498. Under perfect competition, each firm is
C. limited liability a
D. possibility of personality conflict A. Price maker
2494. Which part of the economy includes all B. Price taker
NARAYAN CHANGDER
of the transactions between individuals, C. Neither a and b
households, firms, or businesses?
D. Both a and b
A. Economic Sector
2499. When a monopoly has copyrights or
B. Public Sector patents on their products and no one else
C. Private Sector can create their goods. This is an example
D. Sector 7-G of:
A. natural monopoly
2495. What is NOT a barrier of entry?
B. geographical monopoly
C. technological monopoly
D. government monopoly
2500. In what type of business organization
is each owner personally liable for all busi-
ness debts, even if the debts were created
by other owners?
A. corporation
A. employment
B. partnership
B. start-up cost
C. sole proprietorship
C. technology
D. oligopoly
D. nonprice competition
2501. In which market structure do producers
2496. An example of a horizontal merger have the most market power?
might be if a:
A. publishing company bought a movie
B. monopoly
company
C. oligopoly
B. textile company became a multina-
tional corporation D. perfect competition
C. food chain bought another food chain 2502. Most mergers take place to improve a
D. trucking company bought an airline company’s performance in the eyes of
A. the employees.
2497. SSEMI3 b In which market structure
would a single firm have the most control B. government regulators.
over price? (pick 1) C. tax collectors.
A. Monopoly D. the shareholders.

2503. The ideal model of a market economy is is no longer able spend money going bowl-
known as ing with Barney every week, but now
he has extra time to mow the lawn and

help Wilma with the housework. Is this
B. Oligopoly macroeconomic or microeconomic?
C. Monopoly A. macroeconomic
D. Perfect Competition B. microeconomics
2504. Market structure where many firms 2509. Gas Station

compete for a share of the market through
product differentiation
A. partnership
B. pure competition
D. monopoly
A. monopoly
2505. Impact on the customer:have many B. monopolistic competition
seller options and provides the lowest C. oligopoly
price to consumers
2510. Who controls the prices in perfect com-
petition?
C. Oligopoly A. Consumers
D. Monopoly B. Sellers/firms
2506. What type of monopoly has no other C. The Government tagsSSEMI3
businesses or companies around. An ex- D. none of above
ample could be a gas station in the middle
of the desert. 2511. What is the market structure where the
number of firms is large, there is free en-
A. natural monopoly try and exit of firms, but the goods pro-
B. geographic monopoly duced by them are not homogeneous?
C. tech monopoly A. perfect competition
D. government monopoly B. oligopoly
C. monopoly
2507. How many weeks in 3 years?
A. 158
2512. This type of monopoly provides public
B. 166 goods.
C. 156 A. Natural Monopoly
D. 165 B. Government Monopoly
2508. Fred gets laid off from his job at the C. Technical Monopoly
quarry. Due to his decreased income, he D. Geographic Monopoly

2513. Non Price Factor (NPF)-Increase in per- B. free

sonal tax rates. What curve is impacted in C. non taxable
the TV market and how?
D. non interferring
A. Demand Left
2518. What is the main advantage of perfect
B. Demand Right
competition for consumers?
C. Supply Left A. Best prices
D. Supply Right B. Brand recognition
NARAYAN CHANGDER
2514. What is 100% illegal to do in the USA? C. High barriers of entry
A. monopolies D. Limited information
B. cartels 2519. Which market structure has a unique
C. price discrimination product with no substitutes?
D. all choices given A. Perfect competition
2515. In which market is entry the easiest?
C. Oligopoly
D. Monopoly
2520. In which market structure does a single
C. Oligopoly firm have complete control over the mar-
D. Monopoly ket and its products have no close substi-
tutes?
2516. The market structure with the most con-
trol over prices and as a result, the highest
prices is: B. Perfect Competition
C. Monopoly
D. Oligopoly
2521. When marginal revenue equals marginal
cost, a perfectly competitive firm is
A. determining the price it will set.
B. maximizing its revenues
C. establishing its shutdown point
D. maximizing its profit.
A. Monopoly
2522. In an oligopoly market, the company’s
B. Monopolistic Competition choice of strategy by considering its oppo-
C. Perfect Competition nents’ strategies is called
D. Oligopoly A. Competitive balance
B. Free market equilibrium
2517. In order for something to be considered
a public good, two things must be true:the C. Nash equilibrium
good must be non-rivalry and what? D. Maximum community welfare
A. non exclusionary E. Dominant strategy

2523. MARKET DOMINATED BY A SINGLE 2528. A monopoly’s prices are determined by

SELLER A. competing firms

A. OLIGOPOLY
B. market equilibrium
B. MONOPOLY
C. PERFECT COMPETITION
D. the monopoly itself
D. MONOPOLISTIC COMPETITION
2524. Oligopoly 2529. In the short-run, a firm operating in
a perfectly competitive industry will pro-
A. market structure in which only a few duce the quantity of output where price
large sellers dominate and have the abil- equals marginal cost as long as the
ity to affect prices in an industry
A. price is less than average total cost
B. market structure having all conditions
of pure competition except for identical B. marginal revenue exceeds the
products marginal cost
C. market structure in which a firm has C. price is greater than average variable
a monopoly because of its location or the cost
small size of the market D. price is greater than average fixed
D. monopoly created and or owned by the cost but less than average variable cost
government
2530. What is the equilibrium condition for the
2525. NPF-The Aust Gov’t reintroduces the output produced by a monopoly firm?
Baby Bonus. What curve is impacted in
the pram market and how? A. Marginal cost is greater than marginal
revenue.
A. Demand Left
B. Marginal cost equals marginal rev-
B. Demand Right enue.
C. Supply Left
C. Average cost equals average revenue.
D. Supply Right
D. Total cost equals total revenue.
2526. Why would a company want to merge
with another? 2531. What is an example of a natural
monopoly?
A. grow faster
B. change image A. Centerpoint
C. eliminate competition B. Apple

D. All of the Above C. Beats
2527. Has all the same basic characteristics D. none of above

as a Perfect Competition, But the products
are DIFFERENTIATED
A. A law established by the government
to protect new industries.
B. A commitment on the part of big busi-
C. Oligopoly ness to allow smaller companies to com-
D. Monopoly pete.

C. An obstacle that prevents additional B. monopsons

workers from entering an industry, such C. monopoly
as a union.
D. An obstacle that makes it difficult for
new firms to enter a market. 2537. In the US Economy, resources, goods/
services, and money flow among which
2533. Competitive markets have low barriers economic actors?
to entry. This makes it easy for firms to
A. Households, Business, and the Govern-
NARAYAN CHANGDER
enter and leave the market. Which are ex-
ment
amples of barriers to entry?
B. Households/Individuals, Business,
A. High Start-Up Costs
and Markets
B. Patents
C. Markets, Businesses
C. Large Marketing Budget
D. Household/Individuals, Businesses,
D. Expensive Technology and the Economy
2534. refers to corporations that combine 2538. An organization of workers that seeks
with other corporations, through mergers to improve wages
and buy outs, in order to become or remain A. Nonprofit Organization
competitive and profitable.
B. Private Company
C. Public Company
D. Labor Union
2539. Businesses working together to set

prices of competing goods
A. Price Takers
A. Monopolies B. Monopoly
B. Oligopolies C. Oligopoly
C. Sole Proprietorships D. Price Fixing
D. Corporate Combinations 2540. If a firm can change market prices by al-

tering its output, then it
2535. Antitrust legislation has been passed to
A. Has market power.
allow the government to
B. Faces a flat demand curve.
A. Compete with private companies
C. Is a price taker.
B. Break up monopolies
D. Engages in marginal cost pricing
C. Prevent interference with trusts
D. none of above 2541. What does sigma stand for?
A. standard
by a few large firms that dominate the B. supply
market? C. summation
A. oligopoly D. score

2542. What makes a demand effective? A. perfectly competitive

A. price of the commodity B. perfectly monopolistic

B. the ability of consumers to make pur- C. perfectly inelastic
chase D. perfectly elastic
C. the willingness of consumers to make 2548. The profit-maximizing combination
purchase of output and price for a single-price
D. the supply of the good monopoly is:
2543. Which market structure is influenced by

market equilibrium.
B. Monopoly
C. Oligopoly
D. Monopolistic competition A. Q1 P1
2544. What is the profit maximizing condi- B. Vomit
tion? C. Q1 P4
A. MR = D D. Fall with me
B. MR = MC 2549. SSEMI3 Money payments distributing
C. MCDONALD’S some of a corporations profit to sharehold-
ers on a quarterly basis.
D. D = Profits
A. Dividends
2545. Fast food restaurants are an example of B. Shares
C. Profits
A. nations
D. Money
B. monopolistic competition.
2550. Type of monopoly is based on most ef-
C. pure / perfect competition. ficient distribution of goods being only 1
D. monopolies. business?
A. Natural
2546. Which market structure is very difficult,
but NOT the most difficult to enter into? B. Government
A. Perfect Competition C. Technological
B. Monopolistic Competition D. Geographic
C. Oligopoly 2551. In a limited liability partnership, all part-
ners
D. Monopoly
A. are required to be general partners.
2547. Imagine a product in which customers
B. always have no liability.
were completely price sensitive. Where
even a $0.01 increase would result in zero C. are limited from personal liability in-
quantity demanded. How would you cate- certain situations.
gorize the demand? D. are required to be general partners.

2552. Tara is a seller in a purely competitive 2557. True or False:Actions of one firm will af-
market. Which characteristic of this mkt. fect other firms
structure is true? A. True
A. Tara has a lot of control. B. False
B. Tara has a lot of competition.
2558. What is the mean of 2, 5, 4, 1, and 3?
C. Tara is a sole proprietorship.
A. 2
D. Tara has no competition.
NARAYAN CHANGDER
B. 3
2553. SSEMI3 Which business organization C. 4
has the disadvantage of potential for con-
D. 5
flict?
A. Sole Proprietorship 2559. One advantage of a franchise is
B. Corporation A. the training and advertising is pro-
vided by parent company
C. Partnership
B. profit goes to owner
D. Oligopoly
2560. Very low or no barriers to entry
2554. PERFECT COMPETITION, MONOPOLY
AND PERFECT COMPETITION will max-
imise the profit at B. Monopolistic Competition
A. MR = MC C. Oligopoly
B. MR>MC D. Monopoly
C. MC<MR 2561. The farmers’ market is an example of
D. MR<MC
2555. What is the market structure where the

number of firms is large, there is free en-
try and exit of firms, but the goods pro-
duced by them are not homogeneous?
B. Monopoly
C. Monopolistic competition A. a monopoly.
B. a purely/perfectly competitive mar-
D. Oligopoly
ket.
2556. Which fiscal policy would be most likely C. an oligopoly.
to slow the growth of our economy?
D. a monopolistic competition.
A. Higher taxes
2562. Which type of market structure has
B. Increased government spending
many producers (companies) that sell very
C. A lower discount rate similar products and have almost no con-
D. Increased selling of government secu- trol over price?
rities by the Open Market Committee A. Competitive markets

B. Oligopoly 2567. Decision making tends to be slower in

C. Monopoly this business organization than a sole pro-
prietorship.

D. none of above
A. partnership
2563. What is the result of the government im-
plementing a price floor of $60 B. franchise
C. corporation
2568. Percentage of a total market (100%)

that a business serves
A. Grade
A. There would be a shortage of 100 since
it is cheaper for consumers B. Market Share
B. There would be a surplus of 100 be- C. Merger
cause it is more expensive for consumers D. Monopoly
C. There would be a shortage of 100 be-
cause it is assisting the suppliers 2569. A public utility, such as an electric com-
D. There would be a surplus of 100 be- pany, is an example of a
cause it is beneficial to consumers A. geographic monopoly
2564. Why does the government regulate the B. government monopoly
market?
C. natural monopoly
A. to create their own monopoly
D. none of above
B. to discourage new businesses
C. to ensure competition 2570. is an illegal group of producers who
D. none of above agree to fix prices, limit output, or divide
markets.
a government owned monopoly? A. price-gouging
A. Post Office B. raising prices
B. McDonalds C. Cartel
C. Menards D. collusion
D. Walmart
2571. SSEMI3 b This market structure has a
2566. which of the following is not a legal large number of buyers and sellers with
monopoly identical products
A. natural monopoly
C. industrial monopoly
C. Oligopoly
D. one company buying out all competi-
tion D. Monopoly

2572. The most competitive market structure 2577. Some markets are perfectly competi-
is tive.
A. monopolistic competition. A. True
B. oligopoly. B. False
C. perfect competition. 2578. When P=MR=AR, what market struc-
D. monopoly. ture is this?
2573. Which economic concept does the infor-
NARAYAN CHANGDER
mation in the table illustrate? B. Oligopoly
D. Monopoly
2579. Which of the following is a source of
monopoly power?
A. Absolute advantage A. Scarcity
B. Balance of trade B. Elasticity of demand
C. Factors of production C. Barriers to entry
D. Comparative advantage D. none of above
2574. Which of the following are most likely 2580. Which of the following statements
toimprove a company’s overall productiv- about an oligopoly is false?
ity? A. There are high barriers to entry into
A. Highertax rates on its workers’ in- the market.
comes B. Firms’ output and pricing decisions are
B. Improvements in its trade relations irrelevant their competitors
C. Advances in its technology C. There are only a few firms in the mar-
D. None of the above ket.
D. Firms in the market are mutually inter-
2575. In order for a business to be successful dependent.
it must be
E. Game theory is useful in analyzing the
A. communist strategies of firms competing in the mar-
B. free ket.
C. organized 2581. An example of Human Capital would in-
D. entrepreneur clude
A. The higher the skill the lower the
2576. A market structure in which there are
wages
many buyers and sellers of an identical
product. B. The higher the skill the higher the
wages
A. Monopoly
C. Specialized training does not equal
B. Oligopoly higher pay
C. Perfect Competition D. Unskilled workers and semi-skilled
D. Monopolistic Competition workers get equal pay

2582. Which of the following graphs repre- 2585. An example of this monopoly is the U.S.
sents a firm that is allocatively and pro- Postal Service
ductively efficient?

A. Natural Monopoly
B. Technological Monopoly
A.
D. Geographic Monopoly
B. 2586. Fast food restaurants are an example of
A. differentiation.
C. B. monopolistic competition.
C. pure / perfect competition.
D. monopolies.
D. 2587. Apple Iphone Market(in 2006)

A. Natural
B. Government
2583. This market structure can act like a
monopoly when the if the few firms in- C. Technological
volved all set prices the same D. Geographic
A. Monopoly
2588. Numerous sellers offer similar but
B. Monopolistic Competition slightly different products
C. Perfect Competitio A. Perfect Competition
D. Oligopoly B. Monopolistic Competition
2584. If a single grocery store in Idaho is cur- C. Oligopoly
rently charging a price for potatoes where D. Pure Monopoly
the demand is unit elastic, its marginal rev-
enue for potatoes is 2589. is the study of decisions made by in-
dividuals and business. Examples of this
area include how the price of homes in an
area will impact the number of people who
are willing and able to buy.
A. Microeconomics
B. Socialism
C. Macroeconomics
A. zero. D. Communism
B. maximized 2590. A price taker is a seller that has no con-
C. undefined. trol over the price of the product it sells.
D. negative. A. TRUE
E. positive. B. FALSE

2591. For a monopolistically competitive firm,

at the profit-maximizing quantity of out-
put,
A. price exceeds marginal cost
B. marginal revenue exceeds marginal

cost
NARAYAN CHANGDER
C. marginal cost exceeds average rev-
A. F
enue
B. J
D. price equals marginal revenue
C. L
D. G
2592. There is non-price competition, but busi-
nesses compete by product differentiation 2595. What is scarcity?
and advertising A. The study of how governments print
A. Perfect Competition money.
B. The problem of unlimited wants and
B. Monopolistic Competition limited resources
C. Oligopoly C. The problem of limited wants and un-
limited resources
D. Pure Monopoly
D. The problem of having too few options
2593. Mr Tonkli goes to the ticket booth to buy 2596. the ability to produce a product with
tickets for a Cavs game. Mr. Tonkli is told lower opportunity costs than another coun-
that the game is sold out and no tickets are try
available. Which best explains why there A. absolute advantage
are no basketball tickets available?
B. comparative advantage
A. The arena forgot to print enough tick- C. import
ets.
D. export
B. The supply of tickets was greater than
2597. Trying to satisfy unlimited wants with
the demand.
limited resources defines and is the
C. The arena charged too much money for fundamental problem of economics.
each ticket. A. scarcity
D. The demand for tickets was greater B. needs
than the supply. C. wants
D. microeconomics
2594. If perfect price discrimination were per-
formed by this firm they would begin 2598. Chick Fil A claims their chicken sandwich
charging at point and move all the way tastes better than Popeyes’ chicken sand-
up the demand curve until hitting the ori- wich. This is an example of
gin. A. barrier to entry

B. product differentiation 2602. What is the difference between a

C. patent monopoly and an oligopoly?

D. copyright A. monopoly has low barriers to entry;
oligopoly has high barriers to entry
2599. Airlines are examples of
B. monopoly has competition; oligopoly
does not
C. monopoly has cartels; oligopoly has
price wars
D. monopoly has one seller; oligopoly has
a few tagsSSEMI3

A. purely / perfectly competitive mar- ple of a natural monopoly?
kets.
A. water company
B. monopolies.
B. the U.S. postal service
C. oligopolies.
D. monopolistic competition. C. a patented good
D. diamonds
2600. Monopolists are able to control prices
because they have
2604. In which market structure must sell-
A. much competition and many substi- ers take whatever price the market deter-
tutes mines?
B. much competition and no substitutes
C. no competition and many substitutes
B. oligopoly
D. no competition and no substitutes
2601. James, Scarlett, and Isla are running a
lemonade stand in a perfectly competitive D. monopoly
market. In the short run, at what point
will their stand be in equilibrium? 2605. What is the relationship between price
and quantity demanded in a monopolistic
A. Where the price of lemonade equals
competition market?
their lowest cost
B. Where their average revenue equals A. inverse or negative
total revenue and quantity sold equals B. direct or positive
price times quantity
C. no relationship
C. Where quantity sold equals price
times quantity and quantity equals price D. random
D. Where their marginal cost equals
marginal revenue and marginal cost is ris- 2606. What area(s) in this graph represent
ing consumer surplus at the equilibrium price?

2609. What is NOT one of the five criteria for

A. Large number of buyers and sellers
B. identical products
C. Informed buyers and sellers
D. It is not free to enter and exit the mar-
ket
NARAYAN CHANGDER
A. D + E + F 2610. In which economic system do individuals
have the freedom to make their own eco-
B. A + B + C nomic decisions, but the government also
C. A + B plays a role in the allocation and distribu-
tion of resources?
D. A
A. Mixed economy
E. C + E
B. Command economy
2607. What is a merger? C. Traditional economy
A. when government no longer interferes D. Market economy
in the market, letting it run with no restric-
tions 2611. This market has the largest number of
B. when a company joins with another sellers:
company or companies to form a single A. Perfect competition
firm.
C. when there is an agreement of
oligopoly members to set prices and pro- C. Oligopoly
duction levels D. Monopoly
D. when a company becomes the only ef-
ficient option given decreasing average 2612. When a third party member is affected
costs by the interaction of a buyer and seller, we
call this
2608. 5 Characteristics of Pure Competition
A. Monopoly
C. Oligopoly
D. A Large numbers of buyers and sell-
ers exist.Buyers and sellers deal in iden-
A. An externality
tical products.Buyers and sellers act inde-
pendently.Buyers and sellers must be rea- B. The tragedy of the commons
sonably informed about the products for
C. consumer surplus
sale.Buyers and sellers must be free to en-
ter, conduct or get out of business. D. total welfare

2613. Which type of market structure is the 2614. For an industry to be perfectly competi-
electricity industry? tive, what must exist?

A. perfect competition A. many firms selling similar items
B. many consumers wanting different
items
C. oligopoly C. many firms selling different items
D. monopoly D. none of above

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B. Perfect Competition 21. A market structure in which one firm has

25. Slight control over prices, affordable

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A. Monopoly 57. Coke and Pepsi are part of what market

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69. What are the names of the two ways in B. Oligopoly

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72. Which of the following is an advantage of A. Collusion

70. C 71. D 72. A 73. B 74. A 75. B 76. B 77. D 78. B

C. It means David, Nora, and Ava are B. Monopoly

C. origination D. Firms consider the actions of others

81. The ways in which the competitors try to

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A. Zoning 91. The profit-maximizing rule is that a firm

B. $30 D. A monopoly is a type of board game

86. B 87. A 88. A 89. C 90. C 91. A 92. A 93. C 94. D

C. Monopolistic Competition 100. Which of the following is the BEST ex-

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137. A condition of a Monopolistic Competitive

138. In the short run, when MONOPOLIS-

144. Which type of market structure is the

A. Limited Liability Partnership A. perfect competition

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148. OPEC is an example of a

149. Which of the following is not a type of A. M

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