Chapter1: Making Economics Decisions
Section: Chapter Questions
Problem 1QTC
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The questions attached in the image, the answers I put in are not correct, I just wanted to show the different choices of options. Thanks!
Transcribed Image Text:**Market Structures: Characteristics and Scenarios**
**Table of Market Structures**
This table presents the key characteristics of various market structures. Complete the following characteristics:
| Market Structure | Number of Firms | Type of Product | Entry | Control of Price |
|-----------------------------|-----------------|--------------------------------|------------|------------------|
| Monopolistic Competition | Many | Unique | Impossible | Price maker |
| Monopoly | One | Homogeneous | Easy | Price taker |
| Perfect Competition | Large | Differentiated | Difficult | |
| Oligopoly | Few | Homogeneous or Differentiated | | |
**Scenarios and Market Models**
Determine the market structure for each given scenario:
1. **Scenario:** Dozens of plain white socks producers use a widely known and readily available technology.
- **Market Model:** Monopoly
2. **Scenario:** Only one pharmaceutical company has a government patent to sell an experimental drug.
- **Market Model:** Oligopoly
3. **Scenario:** Hundreds of colleges serve millions of students each year. The colleges vary by location, cost, and quality, which enables students to match schools to their preferences.
- **Market Model:** Perfect competition
4. **Scenario:** Three airlines providing the same service operate between San Francisco and San Diego. There are not enough travelers to share the route with a fourth airline without causing the average costs of the existing ones to rise.
- **Market Model:** Monopolistic competition
This exercise aids in understanding the dynamics of different market structures and their real-world applications.
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