Chapter 7

Chapter 7 objectives
Describe prices and output in a perfectly competitive market, does perfect competition exist today?
Why are monopolies formed? 
What is a differentiated competition?
 What is the difference between a pure and differentiated oligopoly?
What role should government play in regulating business? 
Do different market structures need different forms of regulation?

7-1 (150-154)
Define or give examples of
perfect competition
commodity
barrier to entry
start up costs
Answer questions #1-4 on page 154

7-2 (156- 164)
Define or give examples
Monopoly
economies of scale (explain the graph on 157)
natural monopoly
patent
franchise
price discrimination
market power

What business was mentioned in the fast fact (159)
What monopoly is shown on 160 map?  Why are these cities listed?
Why did marginal revenue fall on the demand schedule (161) when production increased from 10,000 to 11,000 doses of BreathDeep?
Look at 7.7 (162) at what output does a monopolist maximize profit?
Answer #1, 2,3,4 6 on page 164

Read the Bill Gates profile (165)  answer #2

7-3 (166-171)
Define or give examples of
Monopolistic/differentiated competion
non price competition
oligopoly
collusion
price fixing
cartel
Answer questions #1-6 on page 171

7-4 (172-
Define or give examples of
predatory pricing
antitrust laws
trust
merger
deregulation

What was National City Lines (172) and what did it do after WWII?
Answer questions #1-5,7 on page 176