Business Units

Perfect competition is characterize by:

• a large number of sellers and buyers

• sellers acting together to set prices

• diverse products

• uninformed sellers and buyers

Under perfect competition,

• products are similar but not identical 

• no seller can sell a product above the prevailing market price.                               

• a single seller can affect price

• numerous restrictions prevent firms from entering the market.

Which market has no competition?

• perfect competition

• monopoly

• oligopoly

• monopolistic

A perfect competitive firm charges a price that is:

• different to other firms

• lower than other firms

• higher than other firms

• similar to other firms

Which of the following is NOT a characteristic for perfect competition

• no barriers to entry and exit

• perfect information

• large firms

• homogenous products

In perfect competition restrictions, on entry to an industry

•  apply to labor but not to capital

• apply to both capital and labor

• does not exist

• apply to capital but not to labor

In this market structure there is only one seller with a unique product

•   monopoly

• monopolistic competition

• perfect competition

• oligopoly

The airline industry is most likely in the market structure called:

• perfect competition

• monopolistic competition

• oligopoly

• monopoly

Which business is the easiest to form?

• partnerships

• conglomerates

• corporations

• sole proprietorships

In a perfect economy with perfect competition sellers

• enter and exit the market freely

• join with other sellers to influence prices

• control prices

• have incomplete information about market conditions