1. Chapter 7 Review Made by students

2. Which of the following is a public good? A. National defense B. Police C. Highways D. All of the above

3. Which of the following is a public good? A. National defense B. Police C. Highways D. All of the above

4. Externalities are: A. Unintended side effects B. Inadequate competition C. Inadequate information D. All of the above

5. Externalities are: A. Unintended side effects B. Inadequate competition C. Inadequate information D. All of the above

6. Oligopolies consist of A. One seller B. Few large sellers C. Many sellers D. None of the above

7. Oligopolies consist of A. One seller B. Few large sellers C. Many sellers D. None of the above

8. Monopolistic competition is the same thing as perfect competition. True or False?

9. Monopolistic competition is the same thing as perfect competition. True or false? FALSE—products are different and they use advertising

10. There are four types of monopolies. True or False?

11. There are four types of monopolies. True or False? TRUE

12. When buyers and sellers deal in identical products: A. Monopolistic competition B. Oligopoly C. Perfect competition D. Market structures

13. When buyers and sellers deal in identical products: A. Monopolistic competition B. Oligopoly C. Perfect competition D. Market structures

14. Collusion is: A. An agreement to charge the same price for a product B. A formal agreement to set prices or act in a cooperative manner C. When one company lowers their price, other will lower theirs D. Art and literary works for a lifetime plus 50 years

15. Collusion is: A. An agreement to charge the same price for a product B. A formal agreement to set prices or act in a cooperative manner C. When one company lowers their price, other will lower theirs D. Art and literary works for a lifetime plus 50 years

16. One seller of a product is: A. A monopoly B. Monotous seller C. A one man team

17. One seller of a product is: A. A monopoly B. Monotous seller C. A one man team

18. The Sherman Anti-Trust Act forbade discounts of goods to large buyers. True or False?

19. The Sherman Anti-Trust Act forbade discounts of goods to large buyers. True or False? False—it was the first law against monopolies

20. A price war may occur if one company lowers their price and others follow. True or False?

21. A price war may occur if one company lowers their price and others follow. True or False? TRUE

22. Businesses must give information to the public in writing. True or False?

23. Businesses must give information to the public in writing. True or False? True—this is public disclosure

24. Negative externalities affect the third party by harm or inconvenience. True or False?

25. Negative externalities affect the third party by harm or inconvenience. True or False? TRUE

26. Public goods can be withheld. True or False?

27. Public goods can be withheld. True or False? False—everyone receives public goods regardless of income or ability to pay

28. A market structure is the nature and degree of competition among firms operating in the same industry. True or False?

29. A market structure is the nature and degree of competition among firms operating in the same industry. True or False? TRUE

30. The government participates in the economy to prevent competition. True or False?

31. The government participates in the economy to prevent competition. True or False? False—the government promotes competition

32. Five reasons markets fail include all of the following except: A. Resource mobility B. Inadequate competition and information C. Negative externalities D. It includes all of these

33. Five reasons markets fail include all of the following except: A. Resource mobility (should be immobility) B. Inadequate competition and information C. Negative externalities D. It includes all of these

34. There are 5 market structures. True or False?

35. There are 5 market structures. True or False? False—4 market structures: Perfect competition Monopolisitic competition Oligopoly Monopoly

36. What did the Clayton Antitrust Act outlaw? A. Monopolies B. Discounts of goods to large buyers C. Price discrimination D. pollution

37. What did the Clayton Antitrust Act outlaw? A. Monopolies B. Discounts of goods to large buyers C. Price discrimination D. pollution

38. The cease and desist order stops unfair business practices. True or False?

39. The cease and desist order stops unfair business practices. True or False? TRUE

40. An externality is : A. The result of inadequate competition B. Positive or negative C. An unintended side effect D. Something that cannot be withheld

41. An externality is : A. The result of inadequate competition B. Positive or negative C. An unintended side effect D. Something that cannot be withheld

42. A positive externality is a benefit received by a 3 rd party that had nothing to do with the activity. True or False

43. A positive externality is a benefit received by a 3 rd party that had nothing to do with the activity. True or False TRUE

44. A water or gas company has what type of monopoly? A. Natural B. Government C. Technological D. Geographic

45. A water or gas company has what type of monopoly? A. Natural B. Government C. Technological D. Geographic

46. Adequate competition is one reason why markets fail. True or False?

47. Adequate competition is one reason why markets fail. True or False? FALSE—inadequate competition

48. What is an exclusive right to produce, use or sell any new invention? A. Patent B. Copyright C. Sherman Anti-trust Act D. Clayton Anti-trust Act

49. What is an exclusive right to produce, use or sell any new invention? A. Patent B. Copyright C. Sherman Anti-trust Act D. Clayton Anti-trust Act

50. There is no “real perfect competition”—it is used to evaluate other market structures. True or False?

51. There is no “real perfect competition”—it is used to evaluate other market structures. True or False? TRUE—the closest thing to perfect competition is truck farming or a farmers market

52. The reason government participates is because: A. They promote and encourage competition B. Prevent monopolies C. Fulfill the need for public goods D. All of the above

53. The reason government participates is because: A. They promote and encourage competition B. Prevent monopolies C. Fulfill the need for public goods D. All of the above

54. Internalizing externalities will cause the supply curve to shift to the right. True or False?

55. Internalizing externalities will cause the supply curve to shift to the right. True or False? FALSE—great question by the way. It will cause the supply curve to shift to the left—in hopes of reducing the externalities.

56. Pepsi and Coke is an example of an oligopoly. True or False?

57. Pepsi and Coke is an example of an oligopoly. True or False? TRUE

58. Inadequate information is when knowledge that is important to buyers is hard to find. True or False?

59. Inadequate information is when knowledge that is important to buyers is hard to find. True or False? TRUE

60. Pollution is an example of a positive externality. True or False?

61. Pollution is an example of a positive externality. True or False? FALSE—it is a negative externality

62. Requirement that businesses reveal information to the public is: A. Public disclosure B. Internalizing externalities C. Monopoly D. commission

63. Requirement that businesses reveal information to the public is: A. Public disclosure B. Internalizing externalities C. Monopoly D. commission

64. Which of the following is not a type of monopoly? A. Natural B. Government C. Physical D. Geographic

65. Which of the following is not a type of monopoly? A. Natural B. Government C. Physical D. Geographic

66. Which of the following is NOT a public good? A. Highway B. Police C. Firefighters D. Nasa

67. Which of the following is NOT a public good? A. Highway B. Police C. Firefighters D. Nasa

68. Wal-Mart is considered a monopoly. True or False?

69. Wal-Mart is considered a monopoly. True or False? False—(although no one beats their low low prices)—comment made by student, not by me.

70. The United States has many monopolies. True or False?

71. The United States has many monopolies. True or False? FALSE—actually very few

72. The Sherman Anti-Trust Act was made during the Civil War. True or False?

73. The Sherman Anti-Trust Act was made during the Civil War. True or False? FALSE--1914

74. Internalizing externalities is a tax system to lessen negative externalities. True or False?

75. Internalizing externalities is a tax system to lessen negative externalities. True or False? TRUE—the gov’t taxes computers in order to lessen negative side effects.

76. An oligopoly has a few large sellers that dominate the industry and a single firm can change output, sales and price. True or False?

77. An oligopoly has a few large sellers that dominate the industry and a single firm can change output, sales and price. True or False? TRUE

78. Market failure may occur if buyers cannot find important information. True or False?

79. Market failure may occur if buyers cannot find important information. True or False? TRUE

80. In perfect competition, buyers and sellers act independently. True or False?

81. In perfect competition, buyers and sellers act independently. True or False? TRUE