1.
Why does a perfectly competitive market require many participants as both buyers and sellers? (1 point)

because the merchandise must be uniform
so that no individual can control the price
in order to maintain quality over the goods
so that both buyer and seller have the same information

2.
What is the relationship between start-up costs and a competitive market? (1 point)

Markets with high start-up costs are less likely to be perfectly competitive.
Markets with high start-up costs are more likely to be perfectly competitive.
Low start-up costs are likely to make a market less competitive.
There is no consistent relationship between start-up costs and the competitiveness of a market.

3.
Which of the following is characteristic of a competitive market? (1 point)

high costs
low output
inexhaustible supply
efficiency

4.
A natural monopoly is (1 point)

any situation in which only a single seller is allowed to exist.
a monopoly in which the goods produced are agricultural resources.
an industry that runs best when one firm produces all the output.
an industry in which the government provides all the output.

5.
A discounted airline fare is a price discrimination that can be offered because (1 point)

people do not necessarily want to go where the discounts will allow them to go.
vacationers are willing to put up with the restrictions that the airlines impose.
people who fly on business want the price discounts but do not qualify.
senior citizens qualify for discounts on certain types of flights but not on others.