GRCC Micro test 2

Which market structures share the characteristic of many buyers and sellers?

perfect competition and monopolistic competition

In which of the following lists are market structures ordered from the highest number of sellers to the lowest?

perfect competition, monopolistic competition, oligopoly, monopoly

A market situation in which large numbers of firms produce similar but not identical products is:

perfect competition.

The market structure associated with many firms selling a standardized product is:

perfect competition.

The perfectly competitive model assumes that consumers will base their decisions to purchase solely on:

price

Which of the following commonly use game theory?

All of these commonly use game theory.

A monopolist will maximize its profit when it produces the quantity of output where:

MR = MC.

A monopolist participates in price discrimination when they charge:

a lower price to consumers whose demand is more elastic.

Game theory is:

a strategy that requires cooperation when multiple parties are involved.

Which of the following is a characteristic of a monopoly firm?

barriers to entry

When Doritos brand tortilla chips spends money for television commercials, it intends to shift the:

demand curve to the right and make demand more elastic

A characteristic that distinguishes monopolistic competition from perfect competition is:

differentiated products.

The demand curve facing a monopoly firm is:

equivalent to the market demand curve.

In the kinked demand curve model, competitors:

ignore any price increase and match any price decrease by a rival firm.

What market structure has no barriers to market entry and firms that have some control over price?

perfect competition

In a monopoly, the price of the good or service is always:

greater than marginal revenue.

A perfectly competitive firm:

has output that is so small, relative to market supply, that it cannot influence the market price.

Monopolistic competition is like perfect competition in that they both:

have numerous competitors.

Market power means the ability to:

have some control over price.

A Nash equilibrium:

involves a zero-sum game scenario.

Barriers to entry allow some monopolists to:

make people buy more of a good than they really want.

A firm that is the only seller of a good with no close substitutes is a(n):

monopolist

In which type of market structure does the firm have no close substitutes for its product?

monopoly

If it is not profitable for more than one firm to operate within an industry, we have an example of:

monopoly due to ownership of key resources.

A constantly declining long-run average cost curve is a characteristic of what type of industrial structure?

natural monopoly

A handful of firms that exhibit mutually interdependent decision-making are characteristics of what type of market structure?

oligopoly

The key characteristic of monopolistic competition is:

product differentiation.

The Sherman Act makes it illegal to:

restrain trade.

If the demand curve for air travel to London is kinked, and one firm reduces its price, then:

rival firms will reduce their prices.

Which of the following is a characteristic shared by both oligopoly and monopoly?

significant barriers to entry into the market