Market Structures
This market structure has many sellers and identical products.
What is perfect competition?
This occurs when quantity supplied equals quantity demanded.
What is market equilibrium?
This happens when firms secretly agree on prices
What is collusion?
High startup costs are an example of this.
What is a barrier to entry?
Every economy must answer these three questions
What to produce, how to produce, and for whom to produce?
This market structure is controlled by a single firm.
What is a monopoly?
If demand increases and supply stays the same, this happens to price.
What is an increase?
The main reason monopolies can charge higher prices
What is lack of competition?
This is why governments prevent firms from communicating about prices.
This economic system is based on customs and traditions
What is a traditional economy?
A market dominated by a few large firms like airlines or phone companies
What is an oligopoly?
What is inelastic demand?
This makes it hard for new firms to enter a market.
What are barriers to entry?
Too much regulation can sometimes lead to this problem.
What is less competition or higher costs?
This economic system gives the government the most control.
What is a command economy?
This market structure usually results in the lowest prices for consumers.
What is perfect competition?
A price set below equilibrium will usually cause this.
What is a shortage?
This is a common result of price fixing.
What are higher prices for consumers?
Generate a response: What are examples of barriers to entry?
Answers vary. High startup costs, brand loyalty, patents, regulation, discrimination, etc..
The U.S. Economy is best described as this type of economy.
What is a mixed economy?
Bonus: This law is designed to break up monopolies.
What are antitrust laws?
This type of demand changes a lot when price changes.
What is elastic demand?
The government steps in to limit monopoly power through this.
What is regulation?
This happens when only a few firms control most of a market.
What is an oligopoly?
This system relies most on supply and demand.
What is a market economy?