Concentrated Markets Quiz
Test your knowledge of Concentrated Markets with these A-Level Economics questions.
This quiz consists of 15 questions. Scroll down to start the quiz!
Questions
What is a monopoly?
Where there is a single producer in the market.
Describe the term oligopoly?
Where there are a few firms who are interdependent in their actions.
In pure monopolies is the firm a price taker or a price maker?
Price maker.
Firms who operate in perfectly competitive markets are price takers. What does this mean?
It means that they must accept the price set by the market.
What three conditions do there need to be for a firm to be able to be a price maker?
Imperfect knowledge, only one firm in the market, barriers to entry and exit.
How does elasticity of demand influence a firm’s ability to set prices?
The more inelastic demand is the more firms are able to set prices.
What is another term for internal growth?
Organic growth.
Define the term takeover?
Where one firm gains control of another firm.
What types of firms form a conglomerate merger?
Firms that are in different markets.
What is a management buyout?
Where managers in a business take it over by buying a controlling interest in shares.
What is a joint venture?
Where two businesses join to set up a third business to develop a new product or enter a new market.
What benefits to firms gain from outsourcing production overseas?
Reduced costs.
State three factors that influence the degree of monopoly power.
Barriers to entry, number of competitors, advertising, degree of product differentiation.
What curve is the same as the average revenue curve for a monopoly?
The demand curve.
Businesses can either grow internally through organic growth or externally by mergers or takeovers. Using your own knowledge and economic data to what extent do you think it is viable for businesses to grow solely by organic means? (30 marks)
Level 1 – candidate identifies few issues. Doesn’t apply economic concepts well. Lacks analysis and evaluation. Fails to link issues. Limited understanding of different types of growth. 0-6 marks
Level 2 – candidate recognises a few issues and has a limited application of economic concepts. Basic links between issues. Defines different types of growth and explains the key features of each type and advantages and disadvantages. 7-12 marks
Level 3 – Identifies a few issues. Applies economic concepts and ideas to the question. Limited evaluation. Links issues and concepts. 13-20 marks
Level 4 – Identify several issues. Interrelates issues economic issues. Talks in economic language and shows a good level of evaluation as to which methods of growth are best. 21-26 marks
Level 5 – Shows extensive use of economic vocabulary and thought. Arguments are well formed, and information is synthesised. Excellent evaluation of the question with thorough and valid arguments -presented and analysed. 27-30 marks
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