Monopolistic Competition Flashcard

Front

Which of the following is a characteristic of monopolistic competition? A single firm dominates the market. Firms sell products that are perfect substitutes. There are many firms selling differentiated products. There is no freedom of entry and exit in the market.

Back

There are many firms selling differentiated products.

Front

What is a sole proprietorship?

Back

A business owned and managed by a single individual.

Front

What are zoning laws?

Back

Laws in a city or town that designate certain areas, or zones, for residential and business use

Front

What does liability refer to in a business context?

Back

The legal obligation to pay debts other than wages or salary

Front

In a sole proprietorship, who is responsible for all the firm's debts?

Back

The lone entrepreneur

Front

What percentage of businesses in the United States are sole proprietorships?

Back

More than 70 percent

Front

What is a big incentive for entrepreneurs to start a sole proprietorship?

Back

The potential to make a profit

Front

What is one of the advantages of sole proprietorships in terms of regulations?

Back

They are the least regulated form of business organization.

Front

What is one of the advantages of being a sole proprietor?

Back

Full control and high level of freedom

Front

What can be a financial challenge for sole proprietorships?

Back

They have limited access to resources.