Economics -- Unit Two Review

What factors cause a producer's average cost per unit to fall, as output rises?

• Price Leadership
• Market Power
• Differentiation
• Economies of Scale

What is it when you have factors that make it difficult for a business to enter a market?

• Economies of Scale
• Differentiation
• Cartel
• Barriers of Entry

What can replace a natural monopoly?

• technology
• patent
• cartel
• nothing

What kind of market structure is efficient with one business supplying?

• natural monopoly
• oligopoly
• imperfect competition
• perfect competition

What is an example of a government monopoly?

• cellphone industry
• electricity company
• professional sports industry
• oil industry

What is monopolistic competition?

• One company selling the same product
• Many companies selling the same product
• A few companies selling the same product
• Many companies selling a similar, but different product

What is NOT part of non-price competition?

• prices
• location
• quality
• advertising

Why does the government allow monopolies to form through a patent?

• they do not want competition
• no one makes the product better
• company pays for the patent
• company put in the time/ research so they should get rewarded

What is an example of an oligopoly?

• Cattle Industry
• Cell Phone Industry
• Cookie Industry
• Milk Industry

What is NOT a barrier of entry?

• Employment
• Start-up costs
• Technology
• Non-price Competition