chapter 7 review

In a market economy with perfect competition sellers

• control prices

• enter and exit the market freely

• join with other sellers

• have incomplete information about market conditions

Some examples of standardized products include

• eggs and milk

• shirts and jeans

• smart phones and computers

• chairs and tables

In a market economy with imperfect competition sellers

• are always well informed of market conditions

• never have control over prices

• offer only standardized products

• sometimes join with other sellers to influence prices

a market structure where only one producer, produces a product with NO close substitutes

• cartel

• monopoly

• oligopoly

• trust

Monopolists are able to control prices because they have

• much competition and there are many substitutes for their products

• much competition and there are no close substitutes for their products

• no competition and there are many substitutes for their products

• no competition and there are no close substitutes for their products

A monopoly in which the costs of production are lowest when only one firm provides output is called a

• geographic monopoly

• government monopoly

• natural monopoly

• technological monopoly

A monopoly that exists because a firm controls an invention is called a

• geographic monopoly

• government monopoly

• natural monopoly

• technological monopoly

situation in which the average cost of production falls as the producer grows larger is called

• barrier to entry

• economies of scale

• predatory pricing

• public disclosure

Using advertising to try to convince customers to buy one product rather than another is a form of

• antitrust competition

• focus competition

• monopolistic competition

• nonprice competition

monopolistic competition there are

• few sellers and few buyers

• few buyers but many seller

• many buyers but few sellers

• many buyers and many sellers