Question 1

A golf club manufacturer pays its workers based on the number of sets of clubs they produce.This firm

Accepted Answer

A) organizes production based on a command system. 
B) does not have a principal-agent problem. 
C) is a sole proprietorship. 
D) organizes production based on an incentive system. 
E) is a corporation. 
A) organizes production based on a command system. 
B) does not have a principal-agent problem. 
C) is a sole proprietorship. 
D) organizes production based on an incentive system. 
E) is a corporation.

Question 2

An industry with a high four-firm concentration ratio may have little monopoly power if

Accepted Answer

A) its production is geographically concentrated. 
B) its barriers to entry are low. 
C) its barriers to entry are high. 
D) there are no international producers of the product. 
E) there are no close substitutes for its product. 
A) its production is geographically concentrated. 
B) its barriers to entry are low. 
C) its barriers to entry are high. 
D) there are no international producers of the product. 
E) there are no close substitutes for its product.

Question 3

When the Herfindahl-Hirschman Index (HHI)is greater than 1,800,

Accepted Answer

A) the market is very competitive. 
B) a monopoly exists. 
C) there are many producers in the market. 
D) the market is moderately competitive. 
E) the market is uncompetitive. 
A) the market is very competitive. 
B) a monopoly exists. 
C) there are many producers in the market. 
D) the market is moderately competitive. 
E) the market is uncompetitive.

Question 4

The North American economy is ________ and is becoming ________ competitive.

Accepted Answer

A) uncompetitive; less 
B) competitive; more 
C) competitive; less 
D) uncompetitive; more 
E) currently an oligopolistic market; more 
A) uncompetitive; less 
B) competitive; more 
C) competitive; less 
D) uncompetitive; more 
E) currently an oligopolistic market; more

Question 5

Which one of the following statements describes a market that is monopolistically competitive?

Accepted Answer

A) There are significant barriers to entry. 
B) The products produced by the firms are identical. 
C) Many firms compete by making similar but slightly different products. 
D) There is a small number of large firms. 
E) The product produced by one firm has no close substitutes. 
A) There are significant barriers to entry. 
B) The products produced by the firms are identical. 
C) Many firms compete by making similar but slightly different products. 
D) There is a small number of large firms. 
E) The product produced by one firm has no close substitutes.

Question 6

A firm with one or more owners of limited liability is

Accepted Answer

A) a sole proprietorship. 
B) a partnership. 
C) a conglomerate. 
D) a corporation. 
E) a public company. 
A) a sole proprietorship. 
B) a partnership. 
C) a conglomerate. 
D) a corporation. 
E) a public company.

Question 7

Use the information below to answer the following questions.
Fact 10.4.1 GameStop Racks Up the Points
No retailer has more cachet among gamers than GameStop. For now, only Wal-Mart has a larger market share-21.3% last year. GameStop's share was 21.1% last year, and may well overtake Wal-Mart this year. But if new women gamers prefer shopping at Target to GameStop, Wal-Mart and Target might erode GameStop's market share.
Source: Fortune, June 9, 2008
-Refer to Fact 10.4.1.The four-firm concentration ratio for the game market in the United States ________.The HHI for the game market in the United States ________.

Accepted Answer

A) equals 100; equals 10,000 
B) exceeds 60; is less than 1,000 
C) is less than 60; is less than 1,000 
D) ranges from approximately 40 percent to 85 percent; ranges from approximately 900 to 2,025 
E) is close to zero; is close to zero 
A) equals 100; equals 10,000 
B) exceeds 60; is less than 1,000 
C) is less than 60; is less than 1,000 
D) ranges from approximately 40 percent to 85 percent; ranges from approximately 900 to 2,025 
E) is close to zero; is close to zero

Question 8

Which of the following pairs of market types are both characterized by having a large number of firms?

Accepted Answer

A) oligopoly and monopolistic competition 
B) monopoly and oligopoly 
C) perfect competition and monopolistic competition 
D) monopoly and monopolistic competition 
E) perfect competition and oligopoly 
A) oligopoly and monopolistic competition 
B) monopoly and oligopoly 
C) perfect competition and monopolistic competition 
D) monopoly and monopolistic competition 
E) perfect competition and oligopoly

Question 9

A four-firm concentration ratio of less than 60 percent indicates

Accepted Answer

A) a monopoly. 
B) a market that is dominated by a few firms. 
C) a competitive market. 
D) an oligopoly. 
E) an absence of competition. 
A) a monopoly. 
B) a market that is dominated by a few firms. 
C) a competitive market. 
D) an oligopoly. 
E) an absence of competition.

Question 10

The legal responsibility for debts incurred by a sole proprietorship falls upon

Accepted Answer

A) the shareholders. 
B) the partners of the sole proprietorship. 
C) the owner. 
D) the creditors. 
E) the managers. 
A) the shareholders. 
B) the partners of the sole proprietorship. 
C) the owner. 
D) the creditors. 
E) the managers.

Question 11

If economic profit is equal to zero, then the entrepreneur is making

Accepted Answer

A) a normal profit. 
B) zero profit as recorded by accountants. 
C) negative profit as recorded by accountants. 
D) zero taxable income. 
E) an amount equal to the implicit rental rate. 
A) a normal profit. 
B) zero profit as recorded by accountants. 
C) negative profit as recorded by accountants. 
D) zero taxable income. 
E) an amount equal to the implicit rental rate.

A golf club manufacturer pays its workers based on the number of sets of clubs they produce.This firm

An industry with a high four-firm concentration ratio may have little monopoly power if

When the Herfindahl-Hirschman Index (HHI)is greater than 1,800,

The North American economy is and is becoming competitive.

Which one of the following statements describes a market that is monopolistically competitive?

A firm with one or more owners of limited liability is

Which of the following pairs of market types are both characterized by having a large number of firms?

A four-firm concentration ratio of less than 60 percent indicates

The legal responsibility for debts incurred by a sole proprietorship falls upon

If economic profit is equal to zero, then the entrepreneur is making

What Is Economics

The Economic Problem

Demand and Supply

Elasticity

Efficiency and Equity

Government Actions in Markets

Global Markets in Action

Utility and Demand

Possibilities, Preferences, and Choices

Output and Costs

Perfect Competition

Monopoly

Monopolistic Competition

Oligopoly

Externalities

Public Goods and Common Resources

Markets for Factors of Production

Filters

Exam 10: Organizing Production

A golf club manufacturer pays its workers based on the number of sets of clubs they produce.This firm

An industry with a high four-firm concentration ratio may have little monopoly power if

When the Herfindahl-Hirschman Index (HHI)is greater than 1,800,

The North American economy is ________ and is becoming ________ competitive.

Which one of the following statements describes a market that is monopolistically competitive?

A firm with one or more owners of limited liability is

Which of the following pairs of market types are both characterized by having a large number of firms?

A four-firm concentration ratio of less than 60 percent indicates

The legal responsibility for debts incurred by a sole proprietorship falls upon

If economic profit is equal to zero, then the entrepreneur is making

What Is Economics

The Economic Problem

Demand and Supply

Elasticity

Efficiency and Equity

Government Actions in Markets

Global Markets in Action

Utility and Demand

Possibilities, Preferences, and Choices

Output and Costs

Perfect Competition

Monopoly

Monopolistic Competition

Oligopoly

Externalities

Public Goods and Common Resources

Markets for Factors of Production

Filters

The North American economy is and is becoming competitive.