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22508_F25261 Pelones Bernard A: JM_BMEICO
Contributed by: Gnet
  • 1. In monopolistic competition, firms compete mainly through:
A) Non-price competition.
B) Producing identical goods
C) Limiting market entry
D) Price collusion
  • 2. Producing goods at the lowest possible cost is known as:
A) Marginal analysis
B) Productive efficiency.
C) Price leadership
D) Allocative efficiency
  • 3. In monopolistic competition, decision-making by firms is:
A) Independent.
B) Coordinated through agreements
C) Centralized across firms
D) Controlled by the government
  • 4. A firm's ability to slightly influence the price of its product shows that it has:
A) No control
B) Perfect elasticity
C) Market power.
D) Full monopoly
  • 5. A monopolistically competitive firm has some control over price because:
A) Its product is differentiated.
B) Government approves prices
C) There are few competitors
D) It sets industry standards
  • 6. What allows consumers to easily switch between brands in monopolistic competition?
A) Elastic demand.
B) Government regulation
C) Price rigidity
D) Single product type
  • 7. "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
  • 8. Monopolistic competition is a market structure where firms sell products that are:"
A) Homogeneous goods
B) Similar but not identical.
C) Perfect substitutes
D) Regulated by the government
  • 9. Heavy spending on advertising is an example of:
A) Pure competition
B) Cost leadership
C) Collusive pricing
D) Non-price competition.
  • 10. When a company changes packaging and advertising to stand out, it uses:
A) Price leadership
B) Predatory pricing
C) Product differentiation.
D) Price discrimination
  • 11. When resources are used to produce goods that best satisfy consumer preferences, it is called:
A) Economic inequality
B) Technical efficiency
C) Productive efficiency
D) Allocative efficiency.
  • 12. Which statement best defines economic efficiency in monopolistic competition?
A) Maximizing price to increase firm profit
B) Producing the most goods regardless of demand
C) Eliminating all forms of competition
D) Using resources in the best possible way to satisfy consumer needs.
  • 13. The freedom of entry and exit in monopolistic competition ensures:
A) Long-run normal profit.
B) Constant market dominance
C) Barriers to entry
D) Permanent monopoly power
  • 14. Which of the following best describes brand loyalty?
A) Consumers repeatedly buy the same brand despite alternatives.
B) Firms changing prices frequently to attract customers
C) Companies copying competitors' designs
D) Consumers switching to cheaper products easily
  • 15. In the long run, firms in monopolistic competition earn:
A) Supernormal profit
B) No revenue
C) Negative profit
D) Normal profit.
  • 16. The main feature that separates monopolistic competition from perfect competition is:
A) Price control
B) Product differentiation.
C) Government regulation
D) Single seller
  • 17. Which barrier to entry is created when a company owns a vital raw material like diamond mines?
A) Price Discrimination
B) Rent-Seeking
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) Control of Essential Resources.
B) Price Discrimination
C) Rent-Seeking
D) Economies of Scale
  • 19. a monopoly is called a ____ because it has full control over sitting the price of its product
A) Price Taker
B) Free Rider
C) Competitive
D) Price Maker.
  • 20. Consumers pay higher electricity bills because there is only one provider in the market. This represents:
A) Price Ceiling
B) Rent-Seeking
C) Higher Prices.
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) Price Discrimination
B) Control of Essential Resources.
C) Market Equilibrium
D) Technological Superiority
  • 22. Which social cost of monopoly explains why consumers pay more compared to perfect competition?
A) Restricted Output.
B) X-Inefficiency
C) Reduced Consumer Choice
D) Higher Prices
  • 23. A research-based firm spends billions on R&D and secures patents, preventing rivals from duplicating its medicine.This advantage shows:
A) Restricted Output
B) Control of Essential Resources
C) Rent-Seeking Behavior
D) Barriers to Entry through Intellectual Property Rights.
  • 24. When a monopoly has little incentive to minimize costs or innovate, it leads to:
A) Price Discrimination
B) Rent-Seeking
C) Economies of Scale
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) Rent-Seeking
B) Price Control
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) Price Ceiling
B) Rent-Seeking
C) Control of Essential Resources.
D) Profit Maximization
  • 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) 2000
B) 1200
C) 4000
D) 3500
  • 29. A P80 item is 25% off, then taxed 10% on the sale price.

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