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22508_F25261 Pelones Bernard A: JM_BMEICO - Quiz
  • 1. In monopolistic competition, firms compete mainly through:
A) Price collusion
B) Non-price competition.
C) Producing identical goods
D) Limiting market entry
  • 2. Producing goods at the lowest possible cost is known as:
A) Marginal analysis
B) Price leadership
C) Allocative efficiency
D) Productive efficiency.
  • 3. In monopolistic competition, decision-making by firms is:
A) Independent.
B) Controlled by the government
C) Centralized across firms
D) Coordinated through agreements
  • 4. A firm's ability to slightly influence the price of its product shows that it has:
A) Market power.
B) Perfect elasticity
C) Full monopoly
D) No control
  • 5. A monopolistically competitive firm has some control over price because:
A) It sets industry standards
B) There are few competitors
C) Government approves prices
D) Its product is differentiated.
  • 6. What allows consumers to easily switch between brands in monopolistic competition?
A) Government regulation
B) Price rigidity
C) Single product type
D) Elastic demand.
  • 7. "Monopolistic competition is a market structure where firms sell products that are:"
A) Similar but not identical.
B) Homogeneous goods
C) Perfect substitutes
D) Regulated by the government
  • 8. Monopolistic competition is a market structure where firms sell products that are:"
A) Perfect substitutes
B) Homogeneous goods
C) Similar but not identical.
D) Regulated by the government
  • 9. Heavy spending on advertising is an example of:
A) Cost leadership
B) Collusive pricing
C) Non-price competition.
D) Pure competition
  • 10. When a company changes packaging and advertising to stand out, it uses:
A) Product differentiation.
B) Predatory pricing
C) Price leadership
D) Price discrimination
  • 11. When resources are used to produce goods that best satisfy consumer preferences, it is called:
A) Economic inequality
B) Productive efficiency
C) Technical efficiency
D) Allocative efficiency.
  • 12. Which statement best defines economic efficiency in monopolistic competition?
A) Eliminating all forms of competition
B) Maximizing price to increase firm profit
C) Producing the most goods regardless of demand
D) Using resources in the best possible way to satisfy consumer needs.
  • 13. The freedom of entry and exit in monopolistic competition ensures:
A) Barriers to entry
B) Long-run normal profit.
C) Constant market dominance
D) Permanent monopoly power
  • 14. Which of the following best describes brand loyalty?
A) Consumers repeatedly buy the same brand despite alternatives.
B) Consumers switching to cheaper products easily
C) Companies copying competitors' designs
D) Firms changing prices frequently to attract customers
  • 15. In the long run, firms in monopolistic competition earn:
A) Normal profit.
B) Negative profit
C) Supernormal profit
D) No revenue
  • 16. The main feature that separates monopolistic competition from perfect competition is:
A) Price control
B) Government regulation
C) Single seller
D) Product differentiation.
  • 17. Which barrier to entry is created when a company owns a vital raw material like diamond mines?
A) Rent-Seeking
B) Price Discrimination
C) Control of Essential Resources.
D) Economies of Scale
  • 18. Which barrier to entry is created when a company owns a vital raw material like diamond mines?
A) Economies of Scale
B) Rent-Seeking
C) Control of Essential Resources.
D) Price Discrimination
  • 19. a monopoly is called a ____ because it has full control over sitting the price of its product
A) Price Taker
B) Competitive
C) Free Rider
D) Price Maker.
  • 20. Consumers pay higher electricity bills because there is only one provider in the market. This represents:
A) Higher Prices.
B) Rent-Seeking
C) Price Ceiling
D) Profit Maximization
  • 21. A company dominates the market because it owns all major water sources in a region. This monopoly is due to:
A) Technological Superiority
B) Market Equilibrium
C) Control of Essential Resources.
D) Price Discrimination
  • 22. Which social cost of monopoly explains why consumers pay more compared to perfect competition?
A) Higher Prices
B) Reduced Consumer Choice
C) X-Inefficiency
D) Restricted Output.
  • 23. A research-based firm spends billions on R&D and secures patents, preventing rivals from duplicating its medicine.This advantage shows:
A) Barriers to Entry through Intellectual Property Rights.
B) Rent-Seeking Behavior
C) Control of Essential Resources
D) Restricted Output
  • 24. When a monopoly has little incentive to minimize costs or innovate, it leads to:
A) Economies of Scale
B) Price Discrimination
C) Rent-Seeking
D) X-Inefficiency.
  • 25. Despite complaints about high prices, a monopoly retains customers because no alternative products exist. The market condition illustrated here is:
A) Perfect Competition
B) Lack of Consumer Choice.
C) Market Equilibrium
D) Price Ceiling
  • 26. When a monopolist sets output where MC = MR, it is practicing what principle?
A) Price Control
B) Rent-Seeking
C) Market Equilibrium
D) Profit Maximization.
  • 27. A mining firm controls most of the world's diamond production, making it the sole major supplier. This is an example of:
A) Profit Maximization
B) Price Ceiling
C) Rent-Seeking
D) Control of Essential Resources.
  • 28. The ratio of fiction to non-fiction books is 3:5. If there are 3,200 books total, how many are non-fiction?

    1200
A) 1200
B) 2000
C) 3500
D) 4000
  • 29. A P80 item is 25% off, then taxed 10% on the sale price.

    What is the total cost?
A) P66
B) P60
C) P70
D) P55
  • 30. A phone is on sale for P450 (90% of original price). What was the original price?
A) P550
B) P300
C) P500
D) P450
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