Monopolies

Who were considered the 'robber barons' of the 19th century?

• Inventors and scientists

• Presidents and political leaders

• Famous artists and writers

• Cutthroat monopolists like Andrew Carnegie and John D. Rockefeller

Tags

CCSS.RI.5.5

CCSS.RI.6.5

CCSS.RI.7.5

CCSS.RI.8.5

CCSS.RI.9-10.5

What is a pure monopoly?

• A market where the government owns all businesses

• A market with free entry and exit for all

• A market controlled by a single seller with no close substitutes

• A market with many sellers

What is an example of a barrier to entry in a market?

• Government regulations limiting competition

• An abundance of resources

• Low startup costs

• High demand for a product

What does the Sherman Act outlaw?

• Exporting goods to other countries

• All forms of business

• Monopolization or attempted monopolization

• The sale of goods below cost

Tags

CCSS.RI.5.5

CCSS.RI.6.5

CCSS.RI.7.5

CCSS.RI.8.5

CCSS.RI.9-10.5

What is horizontal integration?

• Merging two companies in unrelated industries

• Expanding a company's product line

• Buying companies that produce similar products

• Buying companies that provide different services

Why are patents important for pharmaceutical companies?

• They prevent any competition indefinitely

• They help recover research and development costs

• They guarantee a monopoly for over 50 years

• They allow unlimited pricing

What is a natural monopoly?

• A monopoly that forms naturally without any effort

• A market where competition is based on natural resources

• A situation where one large producer is more cost-effective than several smaller ones

• A monopoly that is approved by nature conservationists

Why do some markets justify the existence of natural monopolies?

• To ensure the highest possible profits

• Because they are too complex for new firms to enter

• To avoid the high costs of having multiple producers

• Because competition is deemed unnecessary

Why was AT&T given natural monopoly status until the 1970s?

• Because it was the only company that knew how to operate telephones

• To ensure high-quality service

• It had nearly complete control of the telephone industry

• Because it was a government agency

What is price discrimination?

• Charging different prices to different customers for the same product

• A discount offered during sales

• Illegal pricing tactics used by monopolies

• Charging the same price to all customers