Understanding Market Structures

What model is applied to understand firm behavior in different market structures?

• Market fluctuation model

• Supply and demand model

• Production costs, revenues, and profits model

• Consumer behavior model

Which market structure is characterized by a large number of small firms with no control over price?

• Monopoly

• Perfect competition

• Oligopoly

• Monopolistic competition

Which market structure involves firms being price takers?

• Monopolistic competition

• Oligopoly

• Monopoly

• Perfect competition

What strategy might a firm in a perfect competition market use to attract customers, given they cannot change prices?

• Increase product size

• Improve customer service

• Reduce production costs

• All of the above

What is a key feature of a monopoly?

• Many competitors

• Single dominant firm

• Low barriers to entry

• Homogeneous products

In which market structure would a local unique restaurant primarily operate?

• Oligopoly

• Monopolistic competition

• Monopoly

• Perfect competition

Which market structure is characterized by product differentiation and substantial control over market prices?

• Monopoly

• Oligopoly

• Perfect competition

• Monopolistic competition

What is a common characteristic of oligopoly?

• No control over price

• High barriers to entry

• Many small firms

• Product homogeneity

What does a high barrier to entry typically indicate about a market structure?

• It is likely an oligopoly

• It does not indicate anything specific

• It is likely a monopoly

• It is likely a perfect competition

Which example best represents an oligopoly?

• Global automotive manufacturers

• Online bookstores

• Street food vendors

• Local coffee shops