Question

Match the following groups: Group A 1. Monopoly 2. Product differentiation 3. Railway 4. Perfect competition 5. Pure competition Group B a) Public monopoly b) Abnormal profit c) Monopolistic Competition d) Prof. Chamberlin e) Absence of transport costs f) Cartel g) Selling cost

Answer 1

1. Monopoly - b) Abnormal profit.

Monopoly is characterized by many features which includes abnormal profit.

2. Product differentiation – c) Monopolistic Competition.

The most notable feature of monopolistic competition is product differentiation.

3. Railway - a) Public monopoly

Railway is an example of Public monopoly.

4. Perfect competition – e) Absence of transport costs

Absence of transport costs is considered as one of the feature of perfect competition, as all the firms are closely located in perfect competition category.

5. Pure competition - d) Prof. Chamberlin

According to Prof. Chamberlin, eradication of monopoly will leads to purity of the market.