Understanding Market Structures Quiz

Which of the following market structures is characterized by a large number of firms producing identical products?

• Monopoly

• Oligopoly

• Perfect competition

• Monopolistic competition

Which of the following is a characteristic of an oligopoly market structure?

• A large number of small firms

• Few firms dominate the market

• No barriers to entry

• Homogeneous (same) products

Which of the following is a common feature of perfect competition?

• Few firms dominate the market

• Product differentiation

• Firms are price takers

• Significant barriers to entry

In a monopoly, the firm has significant control over the price because:

• There are many substitutes available

• There are no barriers to entry

• It is the sole producer of a unique product

• It faces perfect competition

Which of the following is a feature of perfect competition?

• Firms have significant control over prices

• Products are differentiated

• There are no barriers to entry

• Few firms dominate the market

Which of the following is a characteristic of a monopoly?

• Free entry and exit in the market

• Significant barriers to entry

• Many firms producing identical products

• Firms are price takers

Which of the following is a common barrier to entry in a market?

• Low startup costs

• High levels of competition

• Economies of scale

• Easy access to technology

In which market structure do firms have the least control over the price of their product?

• Perfect competition

• Monopolistic competition

• Monopoly

• Oligopoly

Which of the following is a likely outcome in a monopolistic competition market structure?

• Firms engage in non-price competition

• Firms face a perfectly elastic demand curve

• There is only one firm in the market

• Firms earn long-term economic profits

Product differentiation strategies (non-price) are most commonly associated with which market structure?

• Perfect competition

• Monopoly

• Oligopoly

• Monopolistic competition