Scenario Many small shops sell different styles of sweaters. Some stores sell higher-quality and more expensive sweaters than other stores. Dozens companies produce plain white socks. The standard technology for producing socks is widely known and available to anyone who wants to enter the business. Four Internet providers offer similar services to almost everyone in the city. Any new company would have to engage in a price war with the existing companies. Scholastik Inc. owns the U.S. copyright to a popular series of books. It is the only company with the legal right to publish these books in the United States. Hundreds of colleges serve millions of students each year. The colleges vary by location, size, cost, and educational quality, which enables students to match schools to their diverse preferences. The government has granted the U.S. Postal Service the exclusive right to deliver mail. Dozens of pasta producers sell to hundreds of Italian restaurants. Restaurants purchase the least expensive pasta they can find. Producers must pay licensing fees and pass food-safety inspections. Three airlines operate between San Francisco and San Diego. There are not enough potential customers to share the route with a fourth airline without causing the average costs of the existing competitors to rise substantially. Consumers view all airlines as the same service and will select the least expensive one. Number of Firms (One, Few, Many) Type of Product (Homogeneous, Unique, Differentiated) Entry (Easy, Challenging, Impossible) Market Model (Perfect Competition, Monopoly, Monopolistic Competition, Oligopoly)
Scenario Many small shops sell different styles of sweaters. Some stores sell higher-quality and more expensive sweaters than other stores. Dozens companies produce plain white socks. The standard technology for producing socks is widely known and available to anyone who wants to enter the business. Four Internet providers offer similar services to almost everyone in the city. Any new company would have to engage in a price war with the existing companies. Scholastik Inc. owns the U.S. copyright to a popular series of books. It is the only company with the legal right to publish these books in the United States. Hundreds of colleges serve millions of students each year. The colleges vary by location, size, cost, and educational quality, which enables students to match schools to their diverse preferences. The government has granted the U.S. Postal Service the exclusive right to deliver mail. Dozens of pasta producers sell to hundreds of Italian restaurants. Restaurants purchase the least expensive pasta they can find. Producers must pay licensing fees and pass food-safety inspections. Three airlines operate between San Francisco and San Diego. There are not enough potential customers to share the route with a fourth airline without causing the average costs of the existing competitors to rise substantially. Consumers view all airlines as the same service and will select the least expensive one. Number of Firms (One, Few, Many) Type of Product (Homogeneous, Unique, Differentiated) Entry (Easy, Challenging, Impossible) Market Model (Perfect Competition, Monopoly, Monopolistic Competition, Oligopoly)
Chapter1: Making Economics Decisions
Section: Chapter Questions
Problem 1QTC
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The last four questions, not the first four.
Transcribed Image Text:Scenario
Many small shops sell different styles of
sweaters. Some stores sell higher-quality
and more expensive sweaters than other
stores.
Dozens of companies produce plain white
socks. The standard technology for
producing socks is widely known and
available to anyone who wants to enter the
business.
Four Internet providers offer similar services
to almost everyone in the city. Any new
company would have to engage in a price
war with the existing companies.
Scholastik Inc. owns the U.S. copyright to a
popular series of books. It is the only
company with the legal right to publish
these books in the United States.
Hundreds of colleges serve millions of
students each year. The colleges vary by
location, size, cost, and educational quality,
which enables students to match schools to
their diverse preferences.
The government has granted the U.S. Postal
Service the exclusive right to deliver mail.
Dozens of pasta producers sell to hundreds
of Italian restaurants. Restaurants purchase
the least expensive pasta they can find.
Producers must pay licensing fees and pass
food-safety inspections.
Three airlines operate between San
Francisco and San Diego. There are not
enough potential customers to share the
route with a fourth airline without causing
the average costs of the existing competitors
to rise substantially. Consumers view all
airlines as the same service and will select
the least expensive one.
Number of
Firms
(One, Few,
Many)
Type of
Product
(Homogeneous,
Unique,
Differentiated)
Entry
(Easy,
Challenging,
Impossible)
Market Model
(Perfect Competition,
Monopoly,
Monopolistic
Competition,
Oligopoly)
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