15. The level of competition in a given market tends to decrease if: a. minimum

Question

15. The level of competition in a given market tends to decrease if:
a. minimum efficient scale of firms decreases.
b. the number of substitutes increase.
c. barriers to exit are lifted.
d. the number of potential entrants decreases.

25. Interdependent decision making on price, quality, or advertising is characteristic of:
a. perfect competition.
b. monopoly.
c. oligopoly.
d. monopolistic competition.

4. The following market cannot be described as perfectly competitive:
a. the unskilled labor market.
b. discount retailing.
c. the automobile market.
d. the egg markets.

20. A monopsonist is:
a. a competitive buyer of inputs.
b. a single buyer that is able to obtain lower prices.
c. an oligopolist operating in the labor market.
d. a market where a single buyer faces a single seller.

Explanation / Answer

15. The level of competition in a given market tends to decrease if:
the number of potential entrants decreases.
reason: lesser the number of entrants, less is the tendency of competetion. the effective quality of solution/product will also decrease.

25. Interdependent decision making on price, quality, or advertising is characteristic of:
c. oligopoly.

Reason: olygopoly is a market structure in which only a few sellers offer similar or identical products.

All oligopolies have a certain amount of market power. If an oligopolist raises its price, it generally won

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