Chapter 9: Market Structure in the Health Sector

Question 1

Any place at which the individual needing medical and non-medical goods and services can communicate with the one producing medical and non-medical goods and services.

Answer 1

Market

Question 2

Three things to consider with Market

Answer 2

1. Types of goods and services being traded
2. The number and size of buyers and sellers in the market
3. The degree to which information can flow freely

Question 3

What are the four types of Market

Answer 3

1. Perfect Competition
2. Monopolistic Competition
3. Oligopoly
4. Monopoly

Question 4

Does not exist in the real world and can only be examined through perfect competition

Answer 4

Perfect/Pure Market

Question 5

It is an abstract concept or model and involves necessary conditions

Answer 5

Perfect Competition

Question 6

Two critical Assumptions that build Perfect Competition

Answer 6

1. The behavior of an individual firm

2. the nature of an industry in which it operates

Question 7

What is the principal aim of a firm

Answer 7

Maximize profits

Question 8

The demand curve faced by firms is _______

Answer 8

Horizontal

Question 9

When the price of the product is CONSTANT, the change in total revenue is ____ to price

Answer 9

Equal

P=MR

Question 10

The firm will maximize profits by producing at the level of output where Marginal Revenue is _____ to Marginal Cost

Answer 10

Equal

MR = MC

Question 11

A market situation where in the conditions necessary for perfect competitions are not satisfied.

Answer 11

Imperfect Market

Question 12

Forms of Imperfect Market

Answer 12

Monopoly
Monopolistic Competition
Oligopoly

Question 13

Greek word which means one

Answer 13

Monos

Question 14

Greek word which means sell

Answer 14

Polein

Question 15

Under this situation, there is only one seller of goods or services

Answer 15

Monopoly

Question 16

________ is a product market characterized by one seller, perfect barriers to entry, and has considerable control over the price.

Answer 16

Monopoly

Question 17

Price Maker

Answer 17

Monopolist

Question 18

Price Taker

Answer 18

Firm

Question 19

The _______ can influence and has considerable control over the price

Answer 19

Monopolist

Question 20

Refers to a market situation in which firms agree to cooperate with one another to behave as if they were a single firm.

Answer 20

Cartel

Question 21

The most common example of a cartel is the _______ of ______ _____ _______

Answer 21

OPEC

Organization of Petroleum Exporting Countries

Question 22

Monopolies are classified according to…

Answer 22

Cost Structure of the Industry
Possibly the result of law
or by other means

Question 23

It is a market situation where a single firm can supply the entire market due to the fundamental cost structure of the industry.

Answer 23

Natural Monopoly

Question 24

Sometimes called as “de jure monopoly”

Answer 24

Legal Monopoly

Question 25

A form of monopoly which the government grants to a private individual

Answer 25

Legal Monopoly

Question 26

A form of monopoly whose existence as the sole producer and distributor of goods and services is by means of coercion (legal or illegal), so that most of the time it violates the principle of free market just to avoid competition.

Answer 26

Coercive Monopoly

Question 27

It is a market situation in which there are many sellers producing moderate differentiated products.

Answer 27

Monopolistic Competition

Question 28

Greek word which means few

Answer 28

Oligo

Question 29

Greek word which means sell

Answer 29

Polein

Question 30

Is a market structure with few large and relatively high barriers to entry.

Answer 30

Oligopoly

Question 31

Is a formal agreement among oligopolists to set-up a monopoly price, allocate output, and share profit among members.

Answer 31

Cartel

Question 32

Is a formal and informal agreement among oligopolists to adopt policies that will restrict or reduce the level of competition in the market.

Answer 32

Collusion

Question 33

Defined as the demand curve of the individual firm in oligopolistic market

Answer 33

Kinked demand curve

Question 34

(Pg 206) Which type of market? | Number of sellers: LARGE NUMBER OF SELLERS

Answer 34

Perfect Competition

Question 35

(Pg 206) Which type of market? | Number of sellers: MANY

Answer 35

Monopolistic Competition

Question 36

(Pg 206) Which type of market? | Number of sellers: FEW, SMALL NUMBER OF FIRMS

Answer 36

Oligopoly

Question 37

(Pg 206) Which type of market? | Number of sellers: ONLY ONE SELLER

Answer 37

Monopoly

Question 38

(Pg 206) Which type of market? | Degree of control over price: PRICE TAKER

Answer 38

Perfect Competition

Question 39

(Pg 206) Which type of market? | Degree of control over price: LIMITED CONTROL

Answer 39

Monopolistic Competition

Question 40

(Pg 206) Which type of market? | Degree of control over price: SUBSTANTIAL CONTROL OVER PRICE

Answer 40

Oligopoly

Question 41

(Pg 206) Which type of market? | Degree of control over price: PRICE DICTATOR/PRICE MAKER

Answer 41

Monopoly

Question 42

(Pg 206) Which type of market? | Type of Product : HOMOGENOUS PRODUCT

Answer 42

Prefect Competition

Question 43

(Pg 206) Which type of market? | Type of Product : DIFFERENTIATED PRODUCT

Answer 43

Monopolistic Competition

Question 44

(Pg 206) Which type of market? | Type of Product : HOMOGENOUS OR DIFFERNTIATED

Answer 44

Oligopoly

Question 45

(Pg 206) Which type of market? | Type of Product : HIGHLY STANDARDIZED

Answer 45

Monopoly

Question 46

(Pg 206) Which type of market? | Barriers to Entry : NONE

Answer 46

Perfect and Monopolistic Competition

Question 47

(Pg 206) Which type of market? | Barriers to Entry : SUBSTANTIAL

Answer 47

Oligopoly

Question 48

(Pg 206) Which type of market? | Barriers to Entry : COMPLETE

Answer 48

Monopoly

Question 49

(Pg 206) Which type of market? | Degree of consumer Information : PERFECT

Answer 49

Pefect Competition

Question 50

(Pg 206) Which type of market? | Degree of consumer Information : SLIGHTLY IMPERFECT

Answer 50

Monopolistic Competition

Question 51

(Pg 206) Which type of market? | Degree of consumer Information : PERFECT OR IMPERFECT

Answer 51

Oligopoly and Monopoly