Economics Chapter 7 Review

Front

For a firm using economies of scale, the average cost of production __________ as the firm grows larger.

Back

falls

Front

Fill in the blanks using the available answer choices. Spillover effects cause __________ when the costs of a new activity are not reflected in the market prices that users pay.

Back

market failures

Front

A market structure describes the nature and degree of __________ among firms in the same industry.

Back

competition

Front

Which industry best exemplifies an oligopoly? Options: fast-food, farming, women's clothing, publishing

Back

fast-food

Front

What level of government is most closely associated with zoning?

Back

local

Front

A public utility is considered an acceptable type of natural monopoly because it _________.

Back

avoids wasteful duplication of pipes and wires

Front

What is the purpose of the Consumer Financial Protection Bureau?

Back

to provide oversight and guidance in the financial lending industry

Front

A plant in a small town closes, leaving hundreds of people unemployed. There are jobs available at a similar plant in another state, but many of the unemployed workers are unwilling to move or cannot afford to move. An economist might use this example to ______.

Back

define resource immobility

Front

Which statement is most accurate? Options: Markets can sometimes fail. Markets can theoretically fail, but not in reality. Market failure is a myth. Market failure is an unproven hypothesis.

Back

Markets can sometimes fail.

Front

To attract buyers, monopolistic competitors tend to rely on ______.

Back

advertising and promotions