1.Firms in this market have the incentive to hold on to their share of the market. If advertising is successful then it results in shifting the brand demand to the right and making it more elastic.(monopolistic Competition)

a)True

b)False

2.You can find a lot of the same goods in Super-Walmart and The Dollar Store, but the prices are not identical. The Dollar Store uses differentiation by convenience of more locations and quicker shopping.

a)True

b)False

3.In the long run a monopolistic competition firm will make zero economic profit.

a)True

b)False

4.An oligopoly and monopoly firm are similar because...

a)They both have an incentive to collude.

b)They both rely on advertising maintain their market share.

c)There are high barriers to entry.

d)P=ATC in the long run for both firms.

5.An oligopoly market has firms that respond to the actions of their competitors since they impact each other. This is referred to as ...

a)interdependence

b)collusion

c)marke up

d)efficient firm size

e)antitrust

6.The Sherman Act allowed the U.S. government to prevent mergers of firms if the they felt it would result in a market close to a monopoly.

A)true

b)false