Markets, Businesses, & Labor Unit Exam

1. Assume there’s a market with differentiated yet similar products and a very high level of competition among the many firms competing. What type of market structure does this scenario describe?

• a. Perfect Competition
• b. Monopolistic Competition
• c. Oligopoly
• d. Monopoly

2. If a business is the only one selling a product in a specific market, then what type of market structure is this business in?

• a. Perfect Competition
• b. Monopolistic Competition
• c. Oligopoly
• d. Monopoly

3. This market structure has the highest level of competition, and the price is completely determined by the forces of supply and demand.

• a. Perfect Competition
• b. Monopolistic Competition
• c. Oligopoly
• d. Monopoly

4. If businesses in this type of market structure collude to set fixed prices, they are often called a cartel; this is illegal in the United States.

• a. Perfect Competition
• b. Monopolistic Competition
• c. Oligopoly
• d. Monopoly

5. Jimmy owns his own business selling guitar strings. He is the sole owner and assumes all profits and losses of the company. What type of business organization does Jimmy have?

• a. Sole Proprietorship
• b. Cooperative
• c. Partnership
• d. Corporation

6. Law firms are frequently organized this way; two or more owners split profits and losses.

• a. Sole Proprietorship
• b. Nonprofit
• c. Partnership
• d. Corporation

7. These businesses have their stock available for purchase and anyone can become a shareholder. They face heavy taxation and close government regulation.

• a. Sole Proprietorship
• b. Nonprofit
• c. Partnership
• d. Corporation

8. If you wanted to open one of these business organizations, you would purchase exclusive trademark rights and policies from a parent company. Then you would open a brick and mortar recognizable to the public because it’s already an established brand.

• a. Sole Proprietorship
• b. Nonprofit
• c. Cooperative
• d. Business Franchise

9. Unions use this method of negotiating on behalf of their members to employers.

• a. Union Shop
• b. Bread-and-Butter Unionism
• c. Collective Bargaining
• d. Closed Shop

10. When you join a company with this type of union, you must become a union member once you’re hired.

• a. Union Shop
• b. Bread-and-Butter Unionism
• c. Collective Bargaining
• d. Closed Shop