Attempts Average: /1 2. Market structures For each of the following scenarios, i
ID: 1123760 • Letter: A
Question
Attempts Average: /1 2. Market structures For each of the following scenarios, identify the number of firms present, the type of product, and the appropriate market model. Select the matching entry for each dropdown box in the following table Number of Firms Type of Product Scenario There are hundreds of colleges and universities that serve millions of college students each year. The colleges vary by location, size, and educational quality, which allows students with diverse preferences to find schools that match their needs There are hundreds of high school students in need of algebra tutoring services. Dozens of companies offer tutoring services; parents view the quality of the tutoring at the different companies to be largely the same In a small town, there are four providers of broadband Internet access: a cable company, the phone company, and two satellite companies. The Internet access offered by all four providers is of the same speed. Almost everyone in the city already has broadband, so any potential new company would have to engage in a price war with the existing companies and would be unlikely to cover its costs for years, if ever The government has granted a patent to a drug company for an experimental AIDS drug. That company is the only firm permitted to sell the drug Market Model Few Many OneExplanation / Answer
Ans:
Perfect competition is a market structure with large competition and has the following characteristics such as firms sell an identical product, firms are price takers,firms enjoy small market share, freedom of entry and exit and information about products is known.
An oligopoly is a market structure with limited competition between few producers and enjoy a large market share.Due to less competition and large firms oligopoly allows for partnerships and collusion.
Monopolistic competition is market structure in which firms sell differentiated products and since barriers to entry and exit are low, the decisions of one firm will not effect other firm.
Monopoly is a market structure characterized by a single seller who sells a unique product in the market.
Table showing types of products and market models
Scenario Number of firms Types of products Market model Colleges and Universities Many Differentiated Monopolictic competition Tutoring services Many Identical Perfect competition Broadband Internet Few Identical Oligopoly Patent to a drug company One Unique MonopolyRelated Questions
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