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Economics Ch. 7
Prentis Hall Economics New Ulm
| Question | Answer |
|---|---|
| Which is an example of a commodity? | milk |
| A market that is a monopoly has | one seller and many buyers. |
| Public outrage with powerful trusts in the late 1800s led Congress to | pass anti-trust legislation. |
| An example of a market that meets all four conditions for perfect competition is | wheat. |
| A market structure with many sellers and many buyers is | perfect competition. |
| Offering products of different tastes and shapes is an example of | nonprice competition. |
| An example of a barrier to entry is | high start-up costs. |
| Compared to a market with perfect competition, a monopoly often has | higher prices and fewer goods. |
| In many industries, deregulation has resulted in | lower prices for consumers. |
| A market that is an oligopoly has | a few firms dominating the market. |
| A patent, a license to operate a business, and a franchise | are ways that the government can create a monopoly. |
| Economists usually call an industry an oligopoly if | the four largest firms produce at least 70–80 percent of the output. |
| Price discrimination may be found in any market structure except for | perfect competition. |
| One role of the federal government's Justice Department is to | break up monopolies. |
| If several firms decide together to set the market price below their costs for the short term to drive competitors out of business, they are participating in | predatory pricing. |
| A firm with a natural monopoly | usually agrees to allow the government to control the price and service provided. |
| A natural monopoly is a market that runs most efficiently when it has | one large firm providing all output. |
| Public water is an example of a(n) | natural monopoly. |
| For a perfectly competitive market to function properly, buyers and sellers must have access to | adequate information. Sellers need to learn about competitors in the marketplace and buyers need to learn about the best deal possible for the product they plan to purchase. |
| What is one reason that individual producers in a perfectly competitive market have no influence over prices? | Perfectly competitive firms produce a small amount of a product compared to the total supply |
| A product that is the same no matter who produces it, such as beef, gasoline, or corn is | a commodity. |
| A market that runs most efficiently when one large firm supplies all of the output is referred to as | a natural monopoly. The United States Postal Service is an example of a natural monopoly. |
| The right to sell a good or service within an exclusive market is a | francise. |
| A government-issued right to operate a business is a | license. |
| The removal of some government controls over a market is called | deregulation. |
| The combination of two or more companies into a single firm is | a merger. |
| A company that requires customers to buy multiple products from that company to obtain the one product that the customer truly wants is | working around antitrust laws to gain control over the market. |
| Laws that encourage competition in the marketplace are called | antitrust laws. |
| The name for a formal organization of producers that agree to coordinate prices and production is | a cartel. |
| An agreement among firms to charge one price for the same good is | price fixing. |
| What are the three practices of oligopolies that concern the government the most? | price fixing, collusion, and cartels |
| An agreement among firms to divide the market, set prices, or limit production is | collusion. |
Created by:
gcowing
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