Oligopoly and Monopolistic Competition Review

Oligopoly and Monopolistic Competition Review

Assessment

Quiz

Social Studies

11th - 12th Grade

Hard

Created by

Kevin Lam

Used 1+ times

FREE Resource

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6 questions

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1.

MULTIPLE CHOICE QUESTION

45 sec • 1 pt

Which of the following best describes an oligopistic market?

Many sellers with identical barriers to entry

Many sellers, each with a clearly differentiated product, and no barriers to entry

A few competing sellers with similar products and high barriers to entry

A few competing sellers of identical products and no barriers to entry

No competition among sellers and high barriers to entry

2.

MULTIPLE CHOICE QUESTION

2 mins • 1 pt

Media Image

Neither company has a dominant strategy

Both companies have an incentive to reduce production by 10%

Both companies have an incentive to reduce production by 20%

Only UA have an incentive to reduce production by 20%

Only UB have an incentive to reduce production by 20%

3.

MULTIPLE CHOICE QUESTION

1 min • 1 pt

Game theory is used to explain

why firms price discriminate

how monopolies evolve into oligopolies

strategic behavior of firms in oligopoly

profit maximization in monopoly

price leadership of monopolistic competition

4.

MULTIPLE CHOICE QUESTION

2 mins • 1 pt

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Based on the payoff matrix, which of the following is correct?

Firm A always gets a smaller share of the industry profits.

Firm A’s dominant strategy is to advertise.

Firm B’s dominant strategy is not to advertise.

The dominant strategy for both firms is not to advertise.

Neither firm has a dominant strategy.

5.

MULTIPLE CHOICE QUESTION

45 sec • 1 pt

Monopolistically competitive product markets are inefficient because

price equals the marginal value to the buyer of the last item produced

price is greater than marginal cost

excessive competition prevents other firms from entering the market

homogeneous goods are usually overpriced

short-run economic profit-making opportunities exist

6.

MULTIPLE CHOICE QUESTION

1 min • 1 pt

One difference between oligopolies and monopolistically competitive markets is that

there is no deadweight loss in monopolistically competitive markets, but there is in oligopolies

the products sold in monopolistically competitive markets are identical

oligopolies have fewer barriers to entry

firms maximize profits in monopolistically competitive markets but not in oligopolies

there are fewer firms in oligopolistic markets than in monopolistically competitive ones