WorksheetsMarket Structures QUIZ!!
Total questions: 10
Worksheet time: 8mins
Why do US markets dominated by oligopolies result in higher prices than markets with normal competition?
The oligarchies are interdependent with each other. As a result, when one company lowers their price, the other companies will have to lower their prices to match.
The companies of the oligarchy can collude (scheme together) to fix the prices at a unnaturally high rate compared to normal competition.
Keeping up with the other companies of the oligarchy is expensive. To pay for these innovations, prices rise, and there isn't enough competition to lower it.
One company controls the whole industry, so they can charge whatever unreasonably high price they want for their product.
Why do oligopolies frequently appear to act together.
They collude (secretly scheme together) to keep the prices in their industry unnaturally high.
If one company has a lower price or a new innovation, all the other companies will have to match it or risk losing customers.
They are all controlled by one large parent company that delegates what actions each smaller company must perform..
There is generally only one company that actually comes up with good ideas, and all the other companies follow whatever actions they take.
Why is price-fixing illegal in the United State?
It is unethical.
It restrains trade.
It leads to a monopoly.
It creates unnaturally high tariffs.
Which of the following is not a type of monopoly?
Natural
Geographic
Technological
Government
Environmental
You are traveling and run low on gas in an out-of-the-way location. There is only one gas station for the next 30 miles. How would you define this market structure?
Geographical Monopoly
Monopolistic Competition
Oligopoly
Technological Monopoly
A monopoly is a market with
many suppliers
no barriers to entry
many substitutes
one supplier
A barrier to entry is
an economic term for economies of scale
illegal in most markets
anything that prevents new firms from entering the market
a factor that increases competition
