Chapter+7+review

1.) Price Discrimination is when a monopolist divides consumers into groups and charges different prices for the same good. 2.) A market with many firms producing the same good is in Perfect Competition. 3.) Economists define oligopoly as a market structure with a few large firms, each of which has some market power. 4.) Commodity are products that are identical no matter who produces them. 5.) A patent grants the rights to sell an invention without competition. 6.) A natural monopoly may exist in markets where it is most efficient for only one large firm to provide a product. 7.) Economists use the term collusion to describe agreements among firms to set prices and production levels. 9.) How does the buying and selling of stocks fit the model for perfect competition? 10.) Compare and contrast the characteristics of natural monopolies and monopolies created by government. 11.) What four conditions are necessary for a market to be considered monopolistically competitive? 12.) How does the Unite States government intervene in the economy in regard to monopolies and competition? 13.) How do prices, output, and profits differ between monopolies and monopolistically competitive firms? Are there similarities? 14.) What are the trade-offs between free enterprises and the government intervention associated with the United States antitrust policies.