Please join StudyMode to read the full document. Q5 One feature of pure monopoly is that the monopolist is: a a producer of products with close substitutes.

market structure test questions and answers pdf

Q6 Which is a characteristic of a monopolistic competition? Q7 The demand curve for a monopolistically competitive firm has Market structure is defined as the particular environment of a firm, the characteristics of which influence the firm's pricing and output decisions. There are four theories of market structure. The theory of pure competition is a theory that is built on four assumptions: 1. There are many sellers and many buyers, none of which is large in relation to total sales or purchases.

Each firm produces and sells a homogeneous product. Buyers and sellers have all relevant information about prices, product quality, sources of supply, and so forth.

market structure test questions and answers pdf

Firms have easy entry and exit. A pure competitive firm is a price taker. A price taker is a seller that does not have the ability to control the price of the product it sells; it takes the price determined in the market. The pure competitive firm is a price taker because a firm is restrained from being anything but a price taker if it finds itself one among many firms where its supply is small relative to the total market supply, and it sells a homogeneous product in a an environment where buyers and sellers have all relevant information.

Examples of perfect competition include some agricultural Perfect Competition A perfect competition industry infrastructure is one that comprises numerous small sellers and buyers. Firms that comprise the industry produce similar products and consumers have complete and accurate information about their prices.

All firms have equal access to raw materials, capital, labor and technology. A perfectly competitive industry, therefore, has no single market leader or monopolistic firm. All participating companies are identically leveraged and each must offer high quality products to retain customers.

Examples of perfectly competitive industries include those that offer agricultural products, such as livestock, corn and wheat. Pure Monopoly A pure monopoly industry infrastructure comprises a single producer or supplier of a product or a service that has no close substitutes. The single industry player controls all resources and technology and blocks potential competitors from entering the industry. Monopolies are public or private. Public monopolies serve the general public and their primary goal is not profit maximization.There are many buyers.

Firms already in the industry have no advantage over potential new entrants. No single firm can exert a significant influence on the market price of the good.

Market Structures Review Questions.pdf

There are significant restrictions on entry into the industry. Firms and buyers are completely informed about the prices of the products of each firm in the industry. Refer to the Figure below. What price will the monopolist charge in order to maximise profit? A few large firms account for a high percentage of industry output. Each firm faces a horizontal demand curve.

Many small firms account for a high percentage of industry output. Each firm faces a downward sloping demand curve. The industry is often characterised by extensive non-price competition.

Firms in monopolistic competition have some degree of market power. Monopolistic competition has barriers to entry, whereas perfect competition has none. There are a larger number of firms in monopolistic competition. There are a smaller number of firms in perfectly competitive industries.

Raise their profit margin on prices. Differentiate their products from the products of their rivals. Advertise that they charge low prices.

Lobby the government to eliminate barriers to entry. Under which type of market structure is price rigidity stickiness often predicted? Imperfect competition Natural monopoly. Pure monopoly Oligopoly Perfect competition Which two of the following assumptions apply to 'kinked-demand' analysis in oligopoly markets? Rivals' reactions are irrelevant.

Rivals will reduce prices in response to the firm's lower prices. Rivals will raise prices in response to the firm's higher prices. Rivals will tend not to raise prices in response to the firm's higher prices. Rivals will tend not to reduce prices in response to the firm's lower prices. A major threat to longer-term profits exists when barriers to entry into an industry are high. Your browser either does not support scripting or you have turned scripting off.

So, the Submit Answers for Grading button below will not work. The following Submit Answers for Grading button is provided in its place and will clear your answers: The Clear Answers and Start Over feature requires scripting to function.

So, the Clear Answers and Start Over button below will not work. The following Clear Answers button is provided in its place and will clear your answers:. Student Resources. Chapter 6: Market structures. Multiple choice questions. Perfect competition occurs in a market where there are many firms each selling:. Which one of the following does NOT occur in perfect competition?

In perfect competition, a firm's marginal revenue equals its:.What is the total quantity supplied in the market? Will the quantity demanded raise or fall? Will the quantity supplied by each firm rise or fall?

Market Structures: Test Questions and Answers

Monopoly 1 Give an example of a government created monopoly. Is creating this monopoly necessarily bad public policy? Show the profit maximizing level of output. Show the profit maximizing price. Show the deadweight loss from the monopoly. Explain your answer. In each case explain why the monopolist chooses to follow this business strategy.

The marginal cost of each unit of medicine is constant at Rs. What quantity would a profit maximizing manufacturer choose?

What price would it charge? How does marginal revenue compare to the price? At what quantity do the marginal revenue and marginal cost curves intersect? What does this signify? Explain in words what this means. What happens to the equilibrium price and quantity in such a market if one firm introduces a new, improved product?

Explain what happens to this firm as new firms enter the industry. How it increase economic well-being? Answers may approximate. How much the economic profit or loss? Oligopoly 1 Among monopoly, oligopoly, monopolistic competition, and perfect competition, how would you classify the markets for each of the following drinks? Suppose that the marginal cost of mining diamonds is constant at Rs. Each firm is trying to decide whether to undertake a new advertising campaign. The advertising will gain new customers and increase profits only if the other firm does not advertise.

Likewise if Litro advertises, they will earn high profits if Laugfs does not advertise, but low profits if Laugfs also advertises. If neither firm advertises, they keep the medium profits they are currently earning. Prepared by Dilini Aruppala 4. Learn more about Scribd Membership Home. Read free for days Sign In. Much more than documents.

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Discover everything Scribd has to offer, including books and audiobooks from major publishers. Start Free Trial Cancel anytime. Market Structures Review Questions. Uploaded by Somidu Chandimal. Document Information click to expand document information Date uploaded Jan 26, Did you find this document useful?

Is this content inappropriate? Report this Document.These short objective type questions with answers are very important for Board exams as well as competitive exams.

These short solved questions or quizzes are provided by Gkseries. View Answer. Daily Current Affairs October Daily Quiz October Go To Download Page Close.

A Firms have some degree of control over prices. B Producers cannot benefit from knowing other firms' plans. C It is impossible for new firms to enter the industries.

D Collusion and the creation of cartels is common. Answer: Firms have some degree of control over prices.

Lesson 1: How to read Market Structure

A many monopolistically competitive firms. B a few firms sharing monopoly power. C a former monopoly that has been broken up by the government. D a government-granted franchise or monopoly. Answer: a few firms sharing monopoly power. A Competitive monopoly. B Perfect competition. D All of the above are types of market structures.

Answer: Competitive monopoly. A The market structure cannot be determined from the information given. B imperfect competition. C perfect competition. Answer: The market structure cannot be determined from the information given. A a perfect competitor.

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B a monopolistic competitor. C a monopolist.Table of Contents Topic pack - Microeconomics - introduction 1. Actually 3p Labour mobility 1. Market structures - self-test questions - You can skip this for now as it is Theory of the firm 1 Market structures Match the following descriptions with the appropriate market structure?

Perfect competition Monopolistic competition Oligopoly Monopoly b A highly concentrated market with just a few interdependent firms Choose Perfect competition Monopolistic competition Oligopoly Monopoly c A highly competitive market with slightly differentiated products Choose Perfect competition Monopolistic competition Oligopoly Monopoly d A highly competitive market where firms are price takers Choose Perfect competition Monopolistic competition Oligopoly Monopoly Yes, that's correct.

Well done.

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No, that's not quite right. Try again. Your answer has been saved. No, this is fairly competitive but not the most competitive. No, this is where a few firms only dominate the market. No, this is the least competitive. No, this is fairly competitive. Yes, well done. Although the firms are competing against each other, in monopolistic competition there is sufficient differentiation so as to view each firm as almost a monopoly for their own product.

No, this is a feature.

market structure test questions and answers pdf

Yes, this is not a feature - products are assumed to be differentiated. No, the few firms in this industry can also compete in non-price competition. No, firms will also compete through product differentiation.

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Yes, all products appear the same which means price becomes a crucial factor in competition. In perfect competition, there are many firms selling homogenous products. Prices are driven down to the same level. Market structures - self-test questions - You can skip this for now as it is Theory of the firm 1.

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Market structures Match the following descriptions with the appropriate market structure? An industry with significant barriers to entry and a single supplier. Perfect competition Monopolistic competition Oligopoly Monopoly.Information on how to apply. New Course Starting Winter 2018, the Department of Statistics will be offering a new course: STAT 180 Introduction to Data Science Faculty Job Opening The Department of Statistics at the University of Washington is offering a full-time Tenure-Track Assistant (0116) or Tenured Associate (0102) Professor position.

For application details go here. New Courses University of Washington W Applications are invited for a full-time Tenure-Track Assistant or Associate Professor full-time, multi-year, 9-month service period appointment in the Department of Statistics at the University of Washington. Information on how to apply Faculty Position Open Applications are invited for a full-time tenure-track Assistant or Associate Professor position in the Department of Statistics at the University of Washington.

Starting Winter 2018, the Department of Statistics will be offering a new course: STAT 180 Introduction to Data Science Faculty Job Opening The Department of Statistics at the University of Washington is offering a full-time Tenure-Track Assistant (0116) or Tenured Associate (0102) Professor position.

Announcement content including relevant links. The content should not be more the three lines when displayed on site. Adrian Dobra and Nathalie Williams (Sociology) have received an NSF grant titled: ATD: Geospatial Graphical Models of Human Response to Emergencies. More information Tyler McCormick has been awarded an NSF grant titled: ATD: Collaborative Research: Algorithms and Data for High-Frequency, Real-Time Anomaly Detection.

More information Daniela Witten has been awarded an NIH R01 grant titled: A Modeling Framework For Multi-View Data, With Applications To The Pioneer 100 Study And Protein Interaction Networks. More information Sham Kakade (PI), Zaid Harchaoui, Dmitriy Drusvyatskiy (Math), Maryam Fazel (EE), and Yin Tat Lee (CSE) have been awarded an NSF grant titled: TRIPODS: Algorithms for Data Science: Complexity, Scalability, and Robustness.

Three alumni of our department were named as IMS Fellows at the 2017 JSM in Baltimore: Moulinath Banerjee (University of Michigan), Florentina Bunea (Cornell University), Marloes Maathuis (ETH Zurich). But the Earth is very likely to exceed that change, according to new University of Washington research.

More information Fang Han has been awarded a three-year NSF DMS grant, entitled "An Integrated Toolkit for High-Dimensional Complex and Time Series Data Analysis". Zaid Harchaoui has been awarded a Criteo Faculty Research Award for his research project on robust statistical machine learning with change detection and adaptation. More information The Seattle branch of the Association for Women in Science (AWIS) has awarded Emily Fox, their 2017 Award for Scientific Advancement in STEM.

Emily will be recognized at the AWIS Banquet on Tuesday June 6. More information Past announcements New Courses STAT 593: Jon Wellner is teaching a special topics course in the Spring entitled, "Concentration Inequalities and Empirical Process Methods for High-Dimensional Statistics.

Fifth Conference on the Statistical Methods in Psychometrics will be held at Department of Statistics, Columbia University in the city of New York on November 17-18, 2017. It is also the second conference of the 2017-2018 Special Focus Conference Series. Bollinger and Provost John H. Coatsworth host the University. Program Certificate Program Undergraduate Summer Internship Applied Statistics Center Center for Applied Probability Grossman Center Courses Fall Courses Spring Courses Summer Courses Course Descriptions Ph.For example, you might create a model called census to contain all of your work on a U.

The entity you create, named census, is a container for actual implementations of the machine-learning model, which are called versions. Developing a machine-learning model is an iterative process. For that reason, the Cloud ML Engine resource paradigm is set up with the assumption that you'll be making multiple versions of each machine learning model.

This terminology can be confusing because a Cloud ML Engine model resource is not actually a machine-learning model on its own. In Cloud ML Engine a model is a container for the versions of the machine learning model.

The "model" that you deploy to Cloud ML Engine as a model version is a TensorFlow SavedModel. You export a SavedModel in your trainer. A model is an organizational tool that you can use however it makes sense for your situation. It is common, especially after you have a version in production, to keep the inputs and outputs the same between model versions.

This enables you to switch versions without needing to change other application structure you may have built around your model.

It also makes it easy to test new versions with existing data. If you request predictions specifying just a model name, Cloud ML Engine uses the default version for that model. Note that the only time the service automatically sets the default version is when you create the very first one.

market structure test questions and answers pdf

You can manually make any subsequent version the default by calling projects. This enables you to, for example, use a stable default version to serve predictions in production while testing newer versions without creating a dedicated model resource for testing. There are no rules for names beyond those technical requirements, but here are some best-practices:The Cloud ML Engine quota policy sets a limit of 100 models per project and limits the total number of versions (combined between all models) to 200.

Cloud ML Engine needs some information to create your model version.

Market Structures Review Questions.pdf

You also have some options you can configure. This section describes the parameters of both types. These parameters are defined in the Version object or added for convenience in the gcloud ml-engine versions create command.

You can specify the number of training nodes to keep running for your model version. See the section on scaling for more information. If you are using the gcloud command-line tool to deploy your model, you can use a SavedModel on your local computer. The tool stages it in the Cloud Storage location you specify before deploying it to Cloud ML Engine.


Market structure test questions and answers pdf

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