Perfect Competition
True or False: All businesses maximize profits in perfect competition.
True
True or False: Companies maximize profits in imperfect competition.
True.
True or False: It is easy to enter and exit an oligopoly market.
False.
True or False: It is easy to enter and exit a monopolistic market.
False.
A good example of perfect competition.
The Stock Market.
A perfect example of Imperfect Competition.
The market for cereal.
A perfect example of an oligopoly market.
The game console market.
The number of companies that control the market.
One.
The types of goods sold in perfect competition.
Identical Goods
The type of products sold in imperfect competition.
Differentiated products.
What can companies do with prices in oligopoly markets.
Drive them up.
What can the company that controls the market do with the price of goods?
Set it to whatever they want.
They create the socially optimal level of output.
The whole industry.
Another name for Imperfect competition.
Monopolistic Competition.
What companies can do with other companies in oligopoly markets.
Collaborate or compete.
What do monopolies do to increase profit?
Reduce output.
The amount of market power a single business has in perfect competition.
Little power
True or False: This is the most common type of market.
True.
Products in oligopoly markets can be this.
Homogeneous (the same) or different.
Whats the name of the company that controls the corn market?
Monsanto.