econ 1301 chap 13 quiz

In monopolistic​ competition, the presence of a large number of firms making a differentiated product means that

A) each firm can set the price of its particular product.

An oligopoly created because of economies of scale is called a

A) natural oligopoly.

If a large number of firms are​ competing, the market could be

A) perfect competition or monopolistic competition.

If firms in an oligopolistic industry successfully collude and form a​ cartel, what price and output will​ result?

A) the monopoly price and output

The Herfindahl-Hirschman Index is the ________ of the percentage market share of each firm summed over the largest 50 firms in a market

B) square

A firm faces a small number of competitors. This firm is competing in

C) an oligopoly.

Because of the number of firms in monopolistic competition

C) no one firm can dominate the market.

When a city licenses only 3 taxi firms to serve the​ market, the city has created a

D) legal oligopoly.

Which market structure is characterized by the following characteristics?

D) monopolistic competition

If the four-firm concentration ratio equals 0.1 percent for the Mexican tomato industry, then this industry is best characterized as

D) perfect competition.

In an​ oligopoly, output is

D) somewhere between the output in monopoly and that in perfect competition outcomes.

Concentration ratios

measure whether the market is dominated by a small number of firms.

Product differentiation means

products sold by different firms are slightly different.

A market is considered competitive if the Herfindahl−Hirschman Index​ (HHI) is​ ________ and its fourminus−firm concentration ratio is​ ________.

​low; low

A group of firms acting together to limit​ output, raise​ price, and increase economic profit is a called a

cartel