Economics Chapter 07

Which of the following statements is not true about pools?

Concentration ratios can sometimes be misleading.

Market power refers to the power of buyers and sellers to influence prices.

When independent firms agree to work together to establish a monopoly, they have created a(n)

Prices for products of oligopolies are a result of all of the following except

Cartels are generally legal in the United States.

How many competitors exist in monopolistic competition?

As the sole buyer of certain kinds of military hardware, the U.S. government exercises

Under perfect competition, individual sellers

Price takers accept whatever the market or equilibrium price happens to be.

Companies combined to reduce competition after trusts were declared illegal by forming

Many sellers who produce similar products that the buyer believes differ in some qualities is a

The law passed in 1950 that prohibited mergers that would result in a monopoly was the

Price takers have a lot of control over the price they receive for their wares.

The price that monopolists will select to charge for their good or service is the

Monopoly power still remains in the United States economy today.

Controlling interest is ownership of more than 50% of the voting stock in a corporation.

Why would it be extremely difficult for any other firm to enter an industry in a monopoly?

The people who ran companies purchased by trusts were called

All interlocking directorates are illegal.

Large, unregulated monopolies are still very prevalent in the United States economy.

Patents are not enforceable in courts of law.

Monopolists can sell at any price because they are the only sellers of that good/service.

A large business monopoly who shareholders place the firm's control in the hands of trustees is

A corporation organized to own a controlling interest in other corporations is a(n)

What gives inventors of new products the exclusive right to market their inventions?

The federal government grants copyrights and patents as ways of stimulating

When the most powerful company in an industry sets its price and every firm follows, this is

The antitrust law passed by Congress in 1890 was the

Once suppliers begin to exercise control over prices, perfect competition exists.

Mergers in which companies engaged in the same line of business come under one management are

Industries operating under conditions of oligopoly are usually dominated by

Public franchises create monopolies.

Licenses granted by govts to firms that allow them to do business w/in their jurisdiction are

Those who sell in competitive markets are sometimes called

Consumers may prefer one product over another because of

Aspirin is a prime example of product differentiation.

The percentage of an industry's total output produced by its four largest firms is called its

The antitrust law passed in 1887 that created the nation's first regulatory commission was the

Pool agreements could be easily enforced.

The antitrust law passed in 1936 aimed at protecting small stores from chain stores was the

By limiting production to an agreed, low level, the cartel creates a demand for a product.

If two or three firms control nearly all of an industry's output, they have

Pools ceased to exist if one or more member firms broke the rules by

Which can make a product more attracttive to buyers than another virtually identical product?

A market in which there is a single buyer is know as a(n)

Under "perfect competition," market price is determined largely by supply and demand.

The ability of a group of firms to behave as if they were one big monopoly is called

The prices people pay for the costs of daily living are subject to some kind of competition.

In recent decades, the most common form of business combination has been the

When suppliers begin to exercise control over prices, they become known as

There are no monopolies that are considered to be legal in the United States.

Which of the following is not true about businesses that sell haircuts, shoes, and groceries?

The concept of perfect competition provides a useful framework for understanding the market.

Which of the following industries were dominated by trusts in the 1800s?

Monopoly power is directly related to a firm's control over supply.

Economists define oligopoly as an industry with a concentration ratio of 50% or more.

Imperfect competition may be further subdivided into

The concept of perfect competition describes most everyday buying and selling activities.

Pools were created informally and secretly.

Standard Oil Company became the first trust in the United States.

Which of the following may happen when one corporation absorbs another?

When buyers think that virtually identical products are different, this is called

Mergers that combine companies producing unrelated products or services are called

Which conditions must prevail in order for perfect competition to exist?

A type of market in which there is only one seller is called a(n)

Which type of merger has recently become common in the banking industry?

In a perfectly competitive market, no one buyer or seller has the power to set prices.

What gives exclusive rights to artists and musicians to reproduce and/or sell their works?

When the same people sit on the boards of directors of several firms, these firms have

Patents and copyrights are in effect for only a certain amount of time.

"Perfect competition" is largely a theoretical situation.

Two or more firms engaged in different stages of producing the same good/service can join to

The egg market would be considered to be a perfectly competitive market.

Under monopoly conditions, sellers are "price takers."

Antitrust laws are laws that have been enacted to

OPEC is the world's best-known

Product differentiation gives suppliers the power to influence prices.

An essential ingredient of a cartel is

Sellers in competitive markets can sell only at the market, or equilibrium, price.

In the early 1900s, public opposition to trusts resulted in actions by Congress and the courts.

Markets where there is neither pure competition nor pure monopoly are called

A market in which a few sellers produce all or most of the supply of a product is called a(n)

In a perfectly competitive market, there are lots of buyers and sellers.

In perfectly competitive markets, sellers are "price makers."

A major reason for business combinations is the expectation that the merged firms will

Gas stations, groceries, and shoes are services sold under conditions of

Price leadership is

A monopoly is a market in which

Oligopolies strongly encourage price competition.

The higher the concentration ratio in an industry, the

Which of the following is an industry dominated by oligopolies?

When one corporation absorbs another, this is known as a

The laws of supply and demand apply to the market structure of

Which of the following is a reason for a conglomerate merger?

How many competitors exist in an oligopoly?

The illegal practice of making an agreement to limit competition is called

Which of the following laws outlawed trusts that were "in restraint of trade?"

Which of the following is a characteristic of an oligopoly?

Sellers have considerably less market power in a market where there is

Which type of merger is the fed govt most likely to approve?

Economists classify industries with a concentration ratio of 25% or less as

Product differentiation is a characteristic of

An agreement between 2 or more firms to share the market and fix prices for their products is a

How many suppliers exist in a monopoly?

Under perfect competition, sellers have the choice of