Question 1

Oligopoly differs from perfect competition in that in oligopoly:

Accepted Answer

A)   There are few large firms.
B)   There is always freedom of entry and exit.
C)   Firms face an upward sloping demand curve.
D)   Abnormal profits can only be earned in the short term.E) All of the above
F) B) and D)

Question 2

A quota for members of an oligopoly is:

Accepted Answer

A)   A limit on the amount produced
B)   A limit on the price charged
C)   A limit on the profits made
D)   A limit on the number of firms in a marketE) C) and D)
F) B) and C)

Question 3

In oligopoly:

Accepted Answer

A)   Non-price competition is likely.
B)   Every firm is small relative to the market as a whole.
C)   Each firm is a price taker.
D)   Price is equal to average cost.E) C) and D)
F) None of the above

Question 4

In oligopoly firms sometimes agree on prices. This is called:

Accepted Answer

A)   Delusion
B)   Illusion
C)   Solution
D)   CollusionE) A) and B)
F) A) and C)

Question 5

The Kinked Demand Curve model of oligopoly is based on a collusive model of oligopoly.

Accepted Answer

A) True 
 B)False

Question 6

Predatory pricing (or a price war)  occurs when:

Accepted Answer

A)   Firms agree to fix the price.
B)   One firm tries to undercut the competition and force them out of the market.
C)   A firm sets a high price to generate the highest profit possible.
D)   Firms agree to limit the amount they produce.E) C) and D)
F) A) and B) B

Question 7

The n firm concentration ratio measures:

Accepted Answer

A)   The profits of the largest n firms
B)   The employees of the largest n firms
C)   The market share of the largest n firms
D)   The number of stores of the largest n firmsE) None of the above
F) All of the above

Question 8

Firms who join together to behave like a monopoly are said to be in:

Accepted Answer

A)   A partnership
B)   A cartel
C)   A joint venture
D)   A quasi monopsonyE) A) and D)
F) B) and C)

Question 9

Within the confectionery market, before changing its prices Nestlé should consider the likely behaviour of:

Accepted Answer

A)   BP
B)   Mars
C)   Marks and Spencer
D)   HeinzE) A) and B)
F) All of the above B

Question 10

In oligopoly:

Accepted Answer

A)   A few firms dominate the industry.
B)   There are many firms of a similar size.
C)   One firm dominates the industry.
D)   All products are homogeneous.E) A) and B)
F) B) and C)

Question 11

If a limit is set on the amount that each member of a cartel can produce, this is called a _____.

Accepted Answer

The answer of If a limit is set on the...

Question 12

In the Kinked Demand Curve model of oligopoly it is assumed that:

Accepted Answer

A)   An increase in price will be followed by other firms.
B)   A decrease in price will not be followed by other firms.
C)   An increase in price is not followed by other firms.
D)   Price competition is common in the industry.E) All of the above
F) None of the above C

Question 13

In an oligopoly market structure, a firms' behaviour is said to be:

Accepted Answer

A)   Unrelated to other firms
B)   Independent
C)   Interdependent
D)   None of the aboveE) B) and C)
F) None of the above

Question 14

Which of the following is most likely to be associated with an oligopolistic structure?

Accepted Answer

A)   Restaurants
B)   Supermarkets
C)   Commodities
D)   HairdressersE) All of the above
F) A) and B)

Question 15

In a cartel the firms in an oligopoly join together and may set the same price and overall quantity as a monopolist.

Accepted Answer

A) True 
 B)False

Exam 14: Oligopoly

Oligopoly differs from perfect competition in that in oligopoly:

Correct Answer
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A quota for members of an oligopoly is:

Correct Answer
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In oligopoly:

Correct Answer
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In oligopoly firms sometimes agree on prices. This is called:

Correct Answer
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The Kinked Demand Curve model of oligopoly is based on a collusive model of oligopoly.

Correct Answer
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Predatory pricing (or a price war) occurs when:

Correct Answer
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B

The n firm concentration ratio measures:

Correct Answer
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Firms who join together to behave like a monopoly are said to be in:

Correct Answer
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Within the confectionery market, before changing its prices Nestlé should consider the likely behaviour of:

Correct Answer
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B

In oligopoly:

Correct Answer
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If a limit is set on the amount that each member of a cartel can produce, this is called a _____.

Correct Answer
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In the Kinked Demand Curve model of oligopoly it is assumed that:

Correct Answer
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C

In an oligopoly market structure, a firms' behaviour is said to be:

Correct Answer
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Which of the following is most likely to be associated with an oligopolistic structure?

Correct Answer
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In a cartel the firms in an oligopoly join together and may set the same price and overall quantity as a monopolist.

Correct Answer
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Exam 14: Oligopoly

Oligopoly differs from perfect competition in that in oligopoly:

Correct AnswerverifiedShow Answer

A quota for members of an oligopoly is:

Correct AnswerverifiedShow Answer

In oligopoly:

Correct AnswerverifiedShow Answer

In oligopoly firms sometimes agree on prices. This is called:

Correct AnswerverifiedShow Answer

The Kinked Demand Curve model of oligopoly is based on a collusive model of oligopoly.

Correct AnswerverifiedShow Answer

Predatory pricing (or a price war) occurs when:

Correct AnswerverifiedB

The n firm concentration ratio measures:

Correct AnswerverifiedShow Answer

Firms who join together to behave like a monopoly are said to be in:

Correct AnswerverifiedShow Answer

Within the confectionery market, before changing its prices Nestlé should consider the likely behaviour of:

Correct AnswerverifiedB

In oligopoly:

Correct AnswerverifiedShow Answer

If a limit is set on the amount that each member of a cartel can produce, this is called a _____.

Correct AnswerverifiedShow Answer

In the Kinked Demand Curve model of oligopoly it is assumed that:

Correct AnswerverifiedC

In an oligopoly market structure, a firms' behaviour is said to be:

Correct AnswerverifiedShow Answer

Which of the following is most likely to be associated with an oligopolistic structure?

Correct AnswerverifiedShow Answer

In a cartel the firms in an oligopoly join together and may set the same price and overall quantity as a monopolist.

Correct AnswerverifiedShow Answer

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B

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B

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C

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