Oligopoly IB Economics

20 Questions | By Phillip27 | Updated: May 4, 2013 | Attempts: 439

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1.

With the oligopoly market structure there can be many firm in the industry, but the top 4 firms may have a ________________ ratio of 90%.
- A.
  
  Demand
- B.
  
  Concentration
- C.
  
  Supply
- D.
  
  Market
Correct Answer
B. Concentration
2.

Oligopoly industries can produce virtually identical products and highly __________________ products
- A.
  
  Differentiated
- B.
  
  Valuable
- C.
  
  Desirable
- D.
  
  Concentrated
Correct Answer
A. Differentiated
3.

What is a key feature that is common to all oligopolies?
- A.
  
  3 to 4 firms dominate the industry
- B.
  
  Interdependence
- C.
  
  There are always a small number of firms in the industry
- D.
  
  There is price discrimination
Correct Answer
B. Interdependence
4.

Interdependence makes firms want to _______________ and so avoid suprises and unexpected outcomes.
- A.
  
  Cooperate
- B.
  
  Maintain steady prices
- C.
  
  Expand
- D.
  
  Collude
Correct Answer
D. Collude
5.

When oligopolies collude to maximize industry profits they act like a _________________
- A.
  
  Duopoly
- B.
  
  Monopoly
- C.
  
  Imperfect market
- D.
  
  Company in monopolistic competition.
Correct Answer
B. Monopoly
6.

Sometimes monopolies will compete vigorously against each other in order to gain __________________ ___________________
- A.
  
  Higher profits
- B.
  
  Customer satisfaction
- C.
  
  Market share
- D.
  
  Normal profits
Correct Answer
C. Market share
7.

Because prices change less than in competitive markets, oliogpolies tend to be characterised by:
- A.
  
  Price flexibility
- B.
  
  Price fixing
- C.
  
  Price rigidity
- D.
  
  Price skimming
Correct Answer
C. Price rigidity
8.

Formal collusion takes place when firms openly agree on a price they will all charge. This type of collusion is called a
- A.
  
  Cartel
- B.
  
  Syndicate
- C.
  
  Tacit collusion
- D.
  
  Predatory pricing
Correct Answer
A. Cartel
9.

In the US, authorities which investigate price fixing and other anti-competitive behaviour are often called:
- A.
  
  Anti-trust regulators
- B.
  
  Competition regulators
- C.
  
  Price penetration regulators
- D.
  
  All of the other answers are partly correct.
Correct Answer
A. Anti-trust regulators
10.

OPEC is an example of formal collusion between ______________
- A.
  
  Governments
- B.
  
  Oil companies
- C.
  
  Oil bosses
- D.
  
  Oil leaders
Correct Answer
A. Governments
11.

When firms in oligopoly charge the same price without formal collusion, this is an example of:
- A.
  
  Informal collusion
- B.
  
  Tacit collusion
- C.
  
  Accidential collusion
- D.
  
  Non-intential collusion
Correct Answer
B. Tacit collusion
12.

When firms in an oligopoly as a monopolist, they will produce at the point where:
- A.
  
  MC = AC
- B.
  
  MC = AR
- C.
  
  MC = MR
- D.
  
  MC = ATC
Correct Answer
C. MC = MR
13.

In non collusive oligopoly, firms must adopt _______________ behaviour, in order to take into account all possible actions of rivals.
- A.
  
  Regulatory
- B.
  
  Unconvential
- C.
  
  Strategic
- D.
  
  Pricing
Correct Answer
C. Strategic
14.

To explain the strategic behaviour of firms, economists often use
- A.
  
  Complex econometric models
- B.
  
  Theory of knowledge
- C.
  
  Statistical databases
- D.
  
  Game theory
Correct Answer
D. Game theory
15.

American Economist Paul Sweezy attempted to explain the situation with non-collusive oligopoly by developing the:
- A.
  
  Horizontal demand curve
- B.
  
  Vertical demand curve
- C.
  
  Kinked demand curve
- D.
  
  S style demand curve
Correct Answer
C. Kinked demand curve
16.

With a kinked demand curve, there is an assumption that the firm only knows _______ point on its demand curve..
- A.
  
  One
- B.
  
  Every
- C.
  
  Two
- D.
  
  Three
Correct Answer
A. One
17.

With non-collusive oligopoly firms are afraid to raise their prices above the current market price, because other firms:
- A.
  
  Will not follow and they will lose sales
- B.
  
  Might follow and this might lead to less demand
- C.
  
  Will follow and this may anger existing consumers
- D.
  
  Will not follow and industry profits will decline.
Correct Answer
A. Will not follow and they will lose sales
18.

With non-collusive oligopoly firms are afraid to lower their prices below the current market price, because other firms will follow and this will:
- A.
  
  Create a price war and harm all other firms involved.
- B.
  
  Make consumers believe the product is inferior or outdated
- C.
  
  Create a price war and force firms to become more efficient.
- D.
  
  Lead to highly competitive markets and losses for all firms.
Correct Answer
A. Create a price war and harm all other firms involved.
19.

Which of the following is an example of non-price competition?
- A.
  
  Packaging
- B.
  
  Advertising and sales promotion
- C.
  
  Sponsorship deals
- D.
  
  All the other answers are examples.
Correct Answer
D. All the other answers are examples.
20.

Oligopoly is charaterized by very large advertising and marketing expenditures in order to develp brand loyalty and make demand for products:
- A.
  
  Less elastic
- B.
  
  More elastic
- C.
  
  More consistent.
- D.
  
  Less inelastic.
Correct Answer
A. Less elastic

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May 04, 2013

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May 04, 2013

Quiz Created by
Phillip27

Oligopoly IB Economics

With the oligopoly market structure there can be many firm in the industry, but the top 4 firms may have a ________________ ratio of 90%.

Oligopoly industries can produce virtually identical products and highly __________________ products

What is a key feature that is common to all oligopolies?

Interdependence makes firms want to _______________ and so avoid suprises and unexpected outcomes.

When oligopolies collude to maximize industry profits they act like a _________________

Sometimes monopolies will compete vigorously against each other in order to gain __________________ ___________________

Because prices change less than in competitive markets, oliogpolies tend to be characterised by:

Formal collusion takes place when firms openly agree on a price they will all charge. This type of collusion is called a

In the US, authorities which investigate price fixing and other anti-competitive behaviour are often called:

OPEC is an example of formal collusion between ______________

When firms in oligopoly charge the same price without formal collusion, this is an example of:

When firms in an oligopoly as a monopolist, they will produce at the point where:

In non collusive oligopoly, firms must adopt _______________ behaviour, in order to take into account all possible actions of rivals.

To explain the strategic behaviour of firms, economists often use

American Economist Paul Sweezy attempted to explain the situation with non-collusive oligopoly by developing the:

With a kinked demand curve, there is an assumption that the firm only knows _______ point on its demand curve..

With non-collusive oligopoly firms are afraid to raise their prices above the current market price, because other firms:

With non-collusive oligopoly firms are afraid to lower their prices below the current market price, because other firms will follow and this will:

Which of the following is an example of non-price competition?

Oligopoly is charaterized by very large advertising and marketing expenditures in order to develp brand loyalty and make demand for products:

Sometimes monopolies will compete vigorously against each other in order to gain _