Competition & Free Enterprise (icev)

Competition does NOT encourage companies to do which of the following?

• Decrease advertising

• Improve products

• Reduce prices

• Target different markets

The United States utilizes many combinations of the market-buyer structures.

• True

• False

Laissez-faire is a Danish term which literally translates to “to each his own.”

• True

• False

Which economic system prohibits the private ownership and management of resources and emphasizes income and wealth equality?

• Capitalism

• Communism

• Free enterprise

• Socialism

Pure competition creates markets with large numbers of buyers and sellers exchanging a(n) __________ product.

• Homogenous

• Online

• Technological

• Unique

__________ accounts for all income before deductions, but __________ is monetary gain after subtracting operating costs.

• Principle; return

• Profit; revenue

• Return; principle

• Revenue; profit

Which of the following allow fair access to markets for entrepreneurs and are sometimes known as competition laws?

• Anti-trust laws

• Capitalistic laws

• Free enterprise laws

• Trade laws

An oligopoly is most distinguished by the firms interdependence on pricing and marketing.

• True

• False

Which type of market structure has only one firm producing a product?

• Monopolistic competition

• Monopoly

• Oligopoly

• Pure competition

Monopolistic competition refers to a market structure where many firms compete against each other when selling similar, but slightly differentiated products.

• True

• False