CH23 - CHAPTER 23 Pure Competition Topic 1. 2. 3. 4. 5....

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CHAPTER 23 Pure Competition Topic Question numbers ___________________________________________________________________________________________________ 1. Four market models 1-10 2. Pure competition defined; demand curve 11-34 3. Profit maximizing in short run 35-136 4. Profit maximizing in long run 137-176 5. Pure competition and efficiency 177-192 Last Word 193-195 True-False 196-218 ___________________________________________________________________________________________________ Multiple Choice Questions Four market models 1. Economists would describe the U.S. automobile industry as: A) purely competitive. B) an oligopoly. C) monopolistically competitive. D) a pure monopoly. 2. In which of the following market structures is there clear-cut mutual interdependence with respect to price- output policies? A) pure monopoly B) oligopoly C) monopolistic competition D) pure competition 3. Which of the following industries most closely approximates pure competition? A) agriculture B) farm implements C) clothing D) steel 4. Economists use the term imperfect competition to describe: A) all industries which produce standardized products. B) any industry in which there is no nonprice competition. C) a pure monopoly only. Page 1
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D) those markets which are not purely competitive. 5. In which of the following industry structures is the entry of new firms the most difficult? A) pure monopoly B) oligopoly C) monopolistic competition D) pure competition 6. An industry comprised of 40 firms, none of which has more than 3 percent of the total market for a differentiated product is an example of: A) monopolistic competition B) oligopoly C) pure monopoly D) pure competition 7. A one-firm industry is known as: A) monopolistic competition B) oligopoly C) pure monopoly D) pure competition 8. An industry comprised of four firms, each with about 25 percent of the total market for a product is an example of: A) monopolistic competition B) oligopoly C) pure monopoly D) pure competition 9. An industry comprised of a very large number of sellers producing a standardized product is known as: A) monopolistic competition B) oligopoly C) pure monopoly D) pure competition 10. An industry comprised of a small number of firms, each of which considers the potential reactions of its rivals in making price-output decisions is called: A) monopolistic competition B) oligopoly C) pure monopoly D) pure competition Pure competition defined; demand curve 11. Which of the following statements applies to a purely competitive producer? A) It will not advertise its product. B) In long-run equilibrium it will earn an economic profit. Page 2
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C) Its product will have a brand name. D) Its product is slightly different from those of its competitors. 12.
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CH23 - CHAPTER 23 Pure Competition Topic 1. 2. 3. 4. 5....

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