Market Structures Quiz

What is a characteristic of perfect competition?

• Few large firms dominate the market

• Products are differentiated

• Many sellers and buyers

• High barriers to entry

In which market structure do firms have some control over pricing due to brand loyalty?

• Perfect Competition

• Monopolistic Competition

• Oligopoly

• Monopoly

What is a key feature of oligopoly?

• Perfect information

• Homogeneous products only

• Interdependence among firms

• Many small firms

Which market structure is characterized by free entry and exit?

• Oligopoly

• Monopolistic Competition

• Monopoly

• Perfect Competition

What happens in the long run for firms in perfect competition?

• They earn only normal profits

• They face high barriers to entry

• They make abnormal profits

• They can set prices above market price

Which of the following is an example of monopolistic competition?

• Agricultural markets

• Clothing brands

• Steel industry

• Telecommunications

What is a characteristic of monopolistic competition?

• Price takers

• Identical products

• High barriers to entry

• Product differentiation

In oligopoly, what is the term for firms forming agreements to limit competition?

• Price taking

• Collusion

• Perfect information

• Product differentiation

What is a common outcome for firms in monopolistic competition in the long run?

• Abnormal profits

• Normal profits

• Price rigidity

• High market share

Which market structure is considered allocatively and productively efficient?

• Monopolistic Competition

• Perfect Competition

• Oligopoly

• Monopoly