Question 1

Kodak,Fuji,and Agfa control the majority of sales for amateur photographic film.This exemplifies the competitive situation called:
A)an oligopoly.
B)a trilateral monopoly.
C)unfair trade practice.
D)collusion.

Accepted Answer

An oligopoly is a market situation where a few large firms dominate the market and control the majority of sales. Kodak, Fuji, and Agfa control the majority of sales for amateur photographic film, indicating an oligopoly market structure.

Question 2

Becoming a new provider of hydroelectric power in Quebec is likely difficult and so existing providers do not worry much about new competition.Therefore,the ______________ is/are likely high in this marketplace.
A)"smart" security devices designed for office buildings
B)a set of rules and procedures that firms in an industry present to new firms in the industry
C)business practices or conditions that make it difficult for new firms to enter a market
D)a set of security devices used primarily in automobiles

Accepted Answer

The description matches the definition of "entry barriers" which are business practices or conditions that make it difficult for new firms to enter a market.

Question 3

Marketing generally plays a small role in which competitive situation?
A)pure competition
B)a monopoly
C)an oligopoly
D)monopolistic competition

Accepted Answer

The answer of Marketing generally plays a small role in...

Question 4

Canada is sometimes referred to by some economists as the "land of _________" because it has several major industries that can be considered _______,including the airline industry and the banking industry.
A)pure competition, purely competitive
B)oligopoly, oligopolistic
C)monopoly, monopolistic
D)monopolistic competition, monopolistically competitive

Accepted Answer

Canada is referred to as the "land of oligopoly" because several of its major industries, such as the airline and banking industries, are dominated by a few large firms, making them oligopolistic.

Question 5

The competitive situation where Bell Canada,Rogers Wireless,and Telus Mobility control over 90 percent of the mobile phone market is called a(n):
A)monopoly.
B)oligopoly.
C)collusion.
D)monopolistic competition.

Accepted Answer

An oligopoly refers to a competitive situation where a small number of dominant firms (in this case Bell Canada, Rogers Wireless, and Telus Mobility) control a large portion of the market, resulting in limited competition. This is different from a monopoly, where only one company controls the entire market, and monopolistic competition, where numerous companies offer similar but slightly differentiated products. Collusion refers to an illegal agreement between companies to control prices, production, or territory, which is not necessarily confirmed to be happening in this situation.

Question 6

Ralph Moore enjoys soft drinks.He prefers the Seven-Up lemon and lime beverage.He has heard rumours that the Seven-Up Company will be bought out by one of the industries two leading and market dominant competitors.Further,he has heard that if that happens,the Seven-Up brand soft drink will be eliminated since it competes with the competitor's main lemon and lime offering.What Ralph is experiencing are developments that are most likely to take place within which type of competitive environment?
A)monopoly
B)oligopoly
C)pure competition
D)monopolistic competition

Accepted Answer

The scenario described is a characteristic of an oligopoly market structure, where a few dominant firms control the market and can influence competitive actions such as mergers and acquisitions. In a pure competition market, there are many small firms with low market power, while monopoly and monopolistic competition involve one dominant firm or many firms with differentiated products.

Question 7

Paul Avery is a salesperson at the only Ford automobile dealership in Winnipeg,Manitoba.However,there are several other auto dealerships in town,offering both domestic and foreign cars and trucks.Paul works hard to keep his customers satisfied because he knows that if his customers are unhappy,they can simply buy a car from one of the many other comparable dealers in Winnipeg.This is an example of:
A)pure competition.
B)monopolistic competition.
C)an oligopoly.
D)a monopoly.

Accepted Answer

The situation described in the scenario is an example of monopolistic competition. This is because there are many competitors offering comparable products (cars and trucks), but each dealership has some degree of control over its pricing and marketing strategies in order to differentiate itself and attract customers. This means that Paul's dealership cannot set prices too high or provide poor customer service, or else customers will simply go to one of the other dealerships in town.

Question 8

Most of the catalogue retailers during the 2007 Christmas season offered buyers price reductions,coupons,two-for-one buying opportunities and/or free delivery.This is because these catalogue retailers operate in:
A)pure competition.
B)cross-market competition.
C)an oligopoly.
D)monopolistic competition.

Accepted Answer

Catalogue retailers are typically characterized by monopolistic competition, in which firms differentiate their products through marketing, service, and other features. As a result, price discounts and other promotional offers are often used to attract customers and increase sales. This is in contrast to pure competition, in which firms sell identical products and have no control over prices, or an oligopoly, in which a few large firms dominate the market and can coordinate prices and reduce competition. Cross-market competition, which occurs when firms compete in different markets or industries, is not relevant to the description of catalogue retailers.

Question 9

Barriers to entry are business practices or conditions that make it difficult for new firms to enter the market.Which of the following is not an example of a barrier to entry?
A)capital requirements
B)advertising expenditures
C)distribution access
D)a company's manufacturing cycle

Accepted Answer

A company's manufacturing cycle is not an example of a barrier to entry. While it may pose challenges for a new firm to establish an efficient manufacturing process, it is not a business practice or condition that is deliberately designed to prevent new competitors from entering the market. Capital requirements, advertising expenditures, and distribution access are all examples of common barriers to entry.

Question 10

Coupons and sales are frequently used marketing tactics in which form of competition?
A)pure competition
B)cross-market competition
C)oligopoly
D)monopolistic competition

Accepted Answer

Coupons and sales are common tactics used in monopolistic competition, where businesses offer differentiated products that are not perfect substitutes for each other. These tactics are used to attract customers and differentiate their offerings from those of their competitors. In pure competition, all businesses sell a homogeneous product and have no control over the price. In cross-market competition, businesses compete in different markets, which may involve different products or services. In an oligopoly, a few large companies dominate the market, and competition is limited.

Question 11

Although in Canada reasonable efforts are made to provide a "level playing field" in business,it would be difficult for a new Canadian automobile company to be established today,primarily because of:
A)barriers to entry.
B)corporate prejudices.
C)government regulations of competitive practices.
D)lower standards of living.

Accepted Answer

Barriers to entry, such as high start-up costs, limited access to distribution channels, and economies of scale enjoyed by established players, make it difficult for a new Canadian automobile company to be established. This would include challenges related to securing financing, establishing a customer base, and negotiating with suppliers. Corporate prejudices and government regulations may also contribute, but the primary obstacle in this scenario is likely the barriers to entry. Lower standards of living would not be a significant factor in this case.

Question 12

When a new mobile phone operator wants to establish themselves in Canada,they must consider all of the following components or forces that drives competition except:
A)ease of entry
B)the bargaining power of buyers and suppliers
C)monopolistic power
D)the possibility of product substitution

Accepted Answer

The other three components listed (ease of entry, bargaining power of buyers and suppliers, possibility of product substitution) are all factors that contribute to competition in the market. However, monopolistic power is not a force that drives competition; it is actually the opposite, as a single powerful player in the market can stifle competition. Therefore, C is the best answer as it is the only option that is not a driver of competition.

Question 13

Examples of possible barriers to entry include all of the following with the exception of:
A)capital requirements.
B)advertising expenditures.
C)bargaining power of buyers.
D)switching costs.

Accepted Answer

Bargaining power of buyers can be a factor affecting a company's profitability, but it is not a barrier to entry. Barriers to entry are obstacles that prevent new competitors from entering a market, such as high capital requirements, significant advertising expenditures, or high switching costs.

Question 14

The competitive industry where Ford,GM,and Toyota operate in can best be described as:
A)Pure competition
B)Cross-market competition
C)Oligopoly
D)Monopolistic competition

Accepted Answer

An oligopoly is a market structure in which just a few companies dominate the entire industry. In this case, Ford, GM, and Toyota are major players in the automotive industry, making it an oligopoly. The companies have significant market power and can influence the pricing and output levels of the industry.

Question 15

In a situation where coffee bean prices doubled,resulting in the price of coffee doubling as well,consumers may switch to tea,where the prices remained stable.This collective marketplace likely has which type of competition?
A)pure
B)cross-market
C)oligopoly
D)monopolistic

Accepted Answer

The situation described suggests that there are multiple sellers of coffee (implied by the fact that the price increased when the cost of beans increased) and that there are close substitutes available (tea) that consumers can switch to. This is indicative of monopolistic competition, where there are many firms selling differentiated products in a market with relatively low barriers to entry.

Question 16

In considering its competition,a firm must assess the likelihood of new entrants.Additional producers in the marketplace typically:
A)reduce industry capacity and lower prices.
B)reduce industry capacity and raise prices.
C)increase industry capacity and raise prices.
D)increase industry capacity and lower prices.

Accepted Answer

When new entrants join the market, they increase industry capacity, which often leads to increased competition and lower prices due to an increase in supply. Therefore, choice D - increase industry capacity and lower prices - is the most likely outcome when new producers enter the marketplace.

Question 17

The competitive situation where the LCBO operates in is known as a(n):
A)pure competition
B)cross-market competition
C)monopolistic competition
D)monopoly

Accepted Answer

The LCBO (Liquor Control Board of Ontario) operates as a monopoly because it is a government-owned entity that has exclusive control over the sale of alcoholic beverages in Ontario, Canada.

Question 18

Distribution (in the sense of shipping products)is particularly important to which form of competition?
A)cross-market competition
B)pure competition
C)oligopoly
D)monopolistic competition

Accepted Answer

The answer of Distribution (in the sense of shipping products)is...

Question 19

A new brewery that wants to market beer nationally must deal with the fact that Anheuser-Busch spends over $225 million a year on marketing.This statement is an example of _____ for the new national brewery.
A)a barrier to entry
B)the power of buyers
C)the power of suppliers
D)social responsibility

Accepted Answer

The statement about the large marketing budget of Anheuser-Busch is an example of a barrier to entry, which refers to any factor that makes it difficult for a new company to enter a market and compete with established firms. In this case, the significant marketing spending of the dominant player in the market creates a challenge for the new brewery to establish brand recognition and consumer loyalty.

Question 20

Before UPS and FedEx became prominent,Canada Post operated in what type of competition environment?
A)Pure competition
B)Monopoly
C)Oligopoly
D)Monopolistic competition

Accepted Answer

Canada Post operated in a monopoly environment, where it was the sole provider of mail delivery services in Canada. There were no other competitors in the market, giving Canada Post a complete control over the pricing and delivery of mail services.

Quiz 3: Scanning the Marketing Environment

Kodak,Fuji,and Agfa control the majority of sales for amateur photographic film.This exemplifies the competitive situation called:

Becoming a new provider of hydroelectric power in Quebec is likely difficult and so existing providers do not worry much about new competition.Therefore,the ______________ is/are likely high in this marketplace.

Marketing generally plays a small role in which competitive situation?

Canada is sometimes referred to by some economists as the "land of ___" because it has several major industries that can be considered _,including the airline industry and the banking industry.

The competitive situation where Bell Canada,Rogers Wireless,and Telus Mobility control over 90 percent of the mobile phone market is called a(n) :

Most of the catalogue retailers during the 2007 Christmas season offered buyers price reductions,coupons,two-for-one buying opportunities and/or free delivery.This is because these catalogue retailers operate in:

Barriers to entry are business practices or conditions that make it difficult for new firms to enter the market.Which of the following is not an example of a barrier to entry?

Coupons and sales are frequently used marketing tactics in which form of competition?

Although in Canada reasonable efforts are made to provide a "level playing field" in business,it would be difficult for a new Canadian automobile company to be established today,primarily because of:

When a new mobile phone operator wants to establish themselves in Canada,they must consider all of the following components or forces that drives competition except:

Examples of possible barriers to entry include all of the following with the exception of:

The competitive industry where Ford,GM,and Toyota operate in can best be described as:

In a situation where coffee bean prices doubled,resulting in the price of coffee doubling as well,consumers may switch to tea,where the prices remained stable.This collective marketplace likely has which type of competition?

In considering its competition,a firm must assess the likelihood of new entrants.Additional producers in the marketplace typically:

The competitive situation where the LCBO operates in is known as a(n) :

Distribution (in the sense of shipping products) is particularly important to which form of competition?

A new brewery that wants to market beer nationally must deal with the fact that Anheuser-Busch spends over $225 million a year on marketing.This statement is an example of _____ for the new national brewery.

Before UPS and FedEx became prominent,Canada Post operated in what type of competition environment?