Chapter 7 Test

What allows economists to examine competition among businesses in the same industry?

• Market Structure

• Economic structure

• Standardized product

• price taker

Which one is not a characteristic of perfect competition?

• Numerous buyers and sellers

• Standardized product

• well-informed buyers and sellers

• price taker

Firms in monopolistic competition never operate with excess capacity.

• True
• False

In which market structure is there a single seller and no close substitutes for the product?

• Perfect competition

• Monopolistic competition

• Oligopoly

• Monopoly

A monopoly can result from:

• Excessive competition

• Government regulation

• High consumer demand

• All of the above

Which market structure is characterized by many firms, differentiated products, and easy entry for new firms?

• Monopolistic competition

• Oligopoly

• Perfect competition

• Monopoly

Which of the following are true about monopoly market?

• Profit maximizer

• Cross elasticity of demand is one

• Price taker

• Price maker

• No barriers for entry

When a market structure is lacking 1 factor for perfect competition what is the result?

• imperfect competition

• Standardized product

• exiting markets

• entering markets

A business that cannot set prices for its products is know as what?

• Monopoly

• competitive monopoly

• price taker

• price maker

Which market structure is characterized by a large number of small firms, identical products, and easy entry for new firms?

• Monopoly

• Oligopoly

• Perfect competition

• Monopolistic competition