Market structures - perfect competition, monopoly and price discrimination, monopolistic competition, oligopoly and models of oligopoly - Question Bank
1. Which market structure is characterized by the 'invisible hand' guiding resources to their most efficient use?
2. In monopolistic competition, the long-run equilibrium is characterized by:
3. A market with a low HHI value typically indicates:
4. The Herfindahl-Hirschman Index (HHI) is a measure used to assess:
5. Price discrimination is most likely to occur in which market structure?
6. Which model assumes that firms in an oligopoly will adjust their output in response to the output decisions of their rivals, but not simultaneously?
7. In the context of oligopoly, collusion leads to outcomes that are:
8. A firm operating under monopoly power will typically produce:
9. Which of the following is NOT a characteristic of monopolistic competition?
10. The condition for profit maximization for any firm, regardless of market structure, is:
11. Which market structure is characterized by zero economic profit in the long run due to free entry?
12. If a firm is a price maker, it means the firm:
13. In the Bertrand model of oligopoly, firms compete by choosing:
14. Price leadership is a form of tacit collusion often observed in:
15. Which market structure leads to the lowest potential for consumer surplus?
16. In the long run, a firm in monopolistic competition operates at an output level where:
17. Which of the following is an example of a barrier to entry?
18. The Prisoner's Dilemma is often used to illustrate the strategic decision-making challenges in which market structure?
19. In a duopoly, where there are only two firms in the market, the firms might engage in:
20. A situation where firms in an oligopoly produce identical products is known as:
21. Which market structure is characterized by the most product differentiation?
22. In which market structure is the demand curve faced by an individual firm perfectly elastic?
23. The Lerner Index is calculated as:
24. The Lerner Index is a measure of:
25. A natural monopoly typically arises when:
26. Which market structure is most likely to engage in significant non-price competition, such as advertising and branding?
27. A cartel is a group of firms that:
28. In the Stackelberg model of oligopoly, firms compete by choosing:
29. The Cournot model of oligopoly assumes that firms compete by choosing:
30. If a firm in an oligopoly lowers its price, its rivals are assumed to:
31. In the kinked demand curve model, if a firm raises its price, its rivals are assumed to:
32. The kinked demand curve model, proposed by Paul Sweezy, attempts to explain:
33. Which of the following is NOT a common barrier to entry in an oligopolistic market?
34. A key feature of oligopoly is the interdependence of firms, meaning that:
35. Oligopoly is a market structure characterized by:
36. The demand curve faced by a firm in monopolistic competition is:
37. In the long run, firms in monopolistic competition earn:
38. Product differentiation in monopolistic competition can occur through:
39. Monopolistic competition is characterized by:
40. Which of the following conditions must hold for price discrimination to be profitable?
41. For a firm to successfully practice price discrimination, it must:
42. Price discrimination is the practice of:
43. To maximize profits, a monopolist will produce at the output level where:
44. A monopolist faces a demand curve that is:
45. Which of the following is a key characteristic of a monopoly?
46. In the long run, firms in a perfectly competitive industry will earn:
47. A firm in perfect competition will maximize its profits by producing at the output level where:
48. In perfect competition, what is the relationship between a firm's demand curve and its marginal revenue curve?
49. Which characteristic is essential for a market to be considered perfectly competitive?