1.
Which is NOT a characteristic of a
monopoly?
A )Seller sets the market price
b) Entry into the market is easy
c) Firm sells a unique product
d) One seller
2. Perfect competition involves:
a) Sellers working together to set prices
b) A large number of buyers & sellers
c) Difficulty entering & exiting the market
d) Little information is available to buyers
3. What were the three types of
economies of scale mentioned in the
YouTube video on economies of scale?
a) Oligopoly, Monopoly, & Perfect
Competition
b) Land, Labor, & Capital
c) Purchasing, Specialization, & Technical
d) Specialization, Barriers to Entry, &
Technical
4.The market for milk is an example of
perfect competition. Why?
a) Sellers offer a nearly identical product
b)Anyone can start a dairy farm or leave the
dairy business at any time
c) Many people buy and sell milk
d) All of the above
5. The town of Utopia has three gas
stations. The owners of these gas
stations make decisions together about
when to raise and lower gas prices. It
would be difficult for another gas station
to enter this market. Which market
structure best describes the market for
gas in Utopia?
a) Perfect competition
b) Monopolistic competition
c) Oligopoly
d) Monopoly
6. A new firm recently arrived in Utopia
offering much higher internet speeds than
existing providers. The other providers
have gone out of business because so
many Utopian residents have switched to
the new provider. What will most likely
happen to the price of internet service in
Utopia?
a) The price will decrease because the new
provider wants to keep its customers happy.
b) The price will increase because there is
only one internet provider in Utopia.
c) The price will decrease because there is
only internet provider in Utopia.
d) There will be no change in price.
7. List the four market structures in order
from least competitive to most
competitive.
a) Oligopoly, Monopoly, Perfect Competition,
Monopolistic Competition
b) Perfect Competition, Oligopoly,
Monopoly, Monopolistic Competition
c)Monopoly, Oligopoly, Monopolistic
Competition, Perfect Competition
d) Monopoly, Monopolistic Competition,
Perfect Competition, Oligopoly
8. If a major car company such as Ford
lowers their prices, what are other car
companies likely to do?
a) Raise their prices
b) Go out of business
c) Maintain their current prices
d) Lower their prices
9. Which of the following statements is d) Monopolistic Competition
true?
13. Which of the following is NOT a
a) Monopolistic competitors have an Market Structure?
incentive to differentiate their products so
customers have choices, but monopolies do a) Perfect Competition
not have this incentive. b) Oligopoly
b) Monopolistic competitors & monopolies c) Monopoly
have the same amount of influence over the
d) Corporation
price of their products.
c) Both oligopolies & industries with
monopolistic competition involve a large 14. Which market structure involves
number of sellers. selling identical products?
d) All industries fit neatly into one type of
a) Perfect Competition
market structure.
b) Monopolistic Competition
10. Why does the government regulate
natural monopolies? c) Oligopoly
d) Monopoly
a) To increase competition in the market
b) To prevent the monopoly from charging
excessively high prices 15. Markets like automobiles, cell phones,
cable TV, and internet providers are
c) To ensure the monopoly provides an examples of which market structure?
adequate, high-quality amount of the product
d) All of the above are possible reasons for a) Monopoly
regulation b) Oligopoly
11. What are the advantages of c) Perfect competition
economies of scale?
d) Monopolistic competition
a) Costs less per unit to produce an item
b) Reduces barriers to entry in the market
and increases competition
c) Better quality products are produced
12. There are many sellers of blue
jeans. Each blue jean seller makes their
product slightly different to set it apart
from others. There is free entry and exit
into the blue jean market. Which market
structure does this describe?

a) Perfect Competition
b) Oligopoly
c) Monopoly