Economics Homework Nine Answers - Student Seven

Zachary C.

1\. Identify an industry not mentioned in the lecture that is an oligopoly, and explain why.

Clothing manufacturers are an oligopoly because there are a couple dozen companies that produce clothing and they all produce similar products.

Correct.

2\. Order the types of industries from those having the lowest price (due to the greatest competition) to those having the highest price (due to the least competition).

Perfect competition, Perfectly contestable market, Oligopoly, Monopolistic competition, Cartel, Monopoly

Missed competitive monopolies. (Minus 1).

3\. Explain which specific type of industry (e.g., oligopoly or something else) each of these quotes probably refers to: (1) "She's the finest hair stylist in town; no one has her special style!", (2) "Crazy Eddie ... his low prices are INSANE!", (3) "Don't like his prices? He's the only one in town selling what you need."

1) Monopolistic Competition 2) Perfect Competition 3) Monopoly

Excellent!

4\. List how monopolies can be established.

Barrier to entry, control of a valueable resorce, economics of scale, government grants

One more: monopolies established by law, like cable TV franchises. (Minus 1). Also, work on spelling: "valuable", not "valueable".

38/40. Good.