Econ Chapter 7

Question 1

nature and degree of competition among firms within the same industry

Answer 1

Market Structure

Question 2

market structure characterized by a large number of well informed independent buyers and sellers who exchange identical products

Answer 2

Perfect Competition

Question 3

Situation in which the average cost of production falls as the firm gets larger,

Answer 3

Economies of Scale

Question 4

agreement, usually illegal, by firms to change a uniform price for a product

Answer 4

Price-Fixing

Question 5

occurs when there is inadequate competition, inadequate information, resource immobility, public goods or externalities

Answer 5

Market Failure

Question 6

market structure that does not meet all conditions of perfect competition

Answer 6

Imperfect Competition

Question 7

market structure having all conditions of pure competition except for identical products; form of imperfect competition

Answer 7

Monopolistic Competition

Question 8

market situation where a firm has a monopoly because it owns or controls a manufacturing method, process, or other scientific advance

Answer 8

Technological Monopoly

Question 9

philosophy that government should not interfere with business activity

Answer 9

Laissez-faire

Question 10

market structure in which a few buyers dominate and have the ability to affect prices in the industry: form of imperfect competition

Answer 10

Oligopoly

Question 11

agreements, usually illegal, among producers to fix prices, limit outputs, or divide markets

Answer 11

Collusion

Question 12

market structure characterized by a single producer; form of imperfect competiton

Answer 12

Monopoly

Question 13

economic side effect that affects an uninvolved third party

Answer 13

Externality

Question 14

illegal combination of corporations or companies organized to hinder competition

Answer 14

Trust