6 MT

Question 1

industry

Answer 1

a group of firms that produce similar products or provide similar services

Question 2

perfect competition

Answer 2

a market in which there are many independent sellers and buyers, all firms produce a standardized product, firms have free access to the market. and relevant market information is available to all firms and buyers; one of the four main types of market models

Question 3

price taker

Answer 3

a firm that has no real control over the prices it recieves for its products

Question 4

monopoly

Answer 4

a market in which there is only one supplier of a good, no other firms produce a close substitute for that good, and entry into the market is blocked; one of the four main types of market models

Question 5

monopolistic competition

Answer 5

a market in whcih there are a large number of firms that provide differentiated products and have free access to the market; one of the four main types of market models

Question 6

trust

Answer 6

a collusion of business which join together to restrict or eliminate competition

Question 6

oligopoly

Answer 6

a market in which there are only a few firms, products are either differentiated or virtually the same, and potential competitors are discouraged from entering the market by significant entry barriers; one of the four main types of market models

Question 6

price discrimination

Answer 6

the practice of selling the same type of goods at different prices to different buyers

Question 7

Hesiod’s poem

Answer 7

when we see other men and women succeeding in their work, we strive to succeed as they do. Healthy competition in an economy is very beneficial.

Question 8

characteristics of perfect competiton

Answer 8

1. there must be a large number of independent sellers
2. there must be a large number of independent buyers
3. the industry must be one in which all firms produce a standardized product
4. firms must have free access to the market
5. relevant market information must be made available to all firms and buyers

Question 9

characteristics of a monopoly

Answer 9

1. a firm must be the sole supplier of a good or service
2. there must be no close substitutes for the firm’s products
3. entry into the market must be blocked

Question 10

legal monopolies

Answer 10

a monopoly granted by the government in order to encourage production. EX; patent, trademarks, and copyrights help an individual or business protect investments. Government protection is needed in order for people to have the incentive to work to produce the things that can ultimately benefit everyone

Question 11

natural monoply

Answer 11

a monopoly that occurs when a single firm can satisfy the demand for a good more efficiently than multiple firms could. EX: some regions of the U.S. only have one electric company. usually some gov regulation of prices

Question 12

characteristics of monopolistic competition

Answer 12

1. there must be a large number of firms in the market
2. these firms provide differentiated product
3. firms are able to easily enter and exit the market

Question 13

characteristics of an oligopoly

Answer 13

1. there are only a few firms in the entire industry
2. firms in an oligopoly may sell products that are either differentiated or virtually the same
3. potential firms are discouraged by the existence of significant entry barriers

Question 14

collusion

Answer 14

the monopolist practice in which firms secretly agree to chargw the same high prices and offer only the same sort of goods and services

Question 15

the biggest defender of the American freedom from harmful monopolies is

Answer 15

the operation of the free market itself

Question 16

antitrust laws

Answer 16

governmental regulations that prohibit certain monopolistic practices

Question 17

federal trade commission

Answer 17

the commission, established by the Federal Trade Commission Act of 1914, whose duties are to investigate trade practices