Econ: Ch 7 market structures

When the government deregulates a product or service, what happens to it?

• The product or service is available to more people

• The product or service becomes cheaper

• Some government regulations over the industry are eliminated

• Government control over the industry is stopped

What happens to a monopolistically competitive firm that begins to charge an excessive price for its product?

• The firm will go out of business

• Consumers will substitute a rival's product

• Consumers will boycott the product

• The government will regulate the price

Which of the following is NOT a form of nonprice competition?

• location

• physical characteristices

• advertising

• discounts

What is monopolistic competition?

• One company selling the identical product under different names

• One company selling several different products under different names

• A very few companies selling identical products

• Many companies selling similar but not identical

How does a company arrange to sell its products to people who are unwilling to pay the top price for them?

• by allowing rebates to some preferred customers who buy a lot of goods

• by charging each customer the maximum amount they are willing to pay

• by charging different prices according to the group to which the buyer belongs

• by charging the product and selling a lesser one to people who are unwilling to pay for the top product

What is one kind of monopoly that the U.S. government generally permits

• the telephone company

• professional sports leagues

• low-price gasoline

• certain kinds of medications

What kind of market runs most efficiently when one large firm supplies all of the output?

• a natural monopoly

• a network

• perfect competition

• imperfect competition

What was the chief effect of the Sherman Antitrust Acts?

• The federal government repealed regulations that controlled the airline and trucking industries

• Microsoft required personal computer manufacturers to include its web browser with the Microsoft Windows operating system

• John D. Rockefeller formed the Standard Oi Trust as a protected natural monopoly

• The federal government won the power to prevent monopolies and merges that interfered with trade between states.

When is a buyer NOT willing to spend a lot of time and energy researching the market?

• when buying a large quantity of goods

• when there are many identical products available

• when the savings to be made are small

• when prices vary but quality is the same

Which of these industries has NOT been considered a natural monopoly in the past 30 years

• diamonds

• water

• electricity

• phone service