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    Question

    A type of market system combining elements of monopoly

    and perfect competition, is known as?
    A Oligopoly Correct Answer Incorrect Answer
    B Monopolistic Competition Correct Answer Incorrect Answer
    C Monopsony Correct Answer Incorrect Answer
    D All of these Correct Answer Incorrect Answer
    E None of these Correct Answer Incorrect Answer

    Solution

    Perfect Competition: Perfect competition is a market system characterized by many different buyers and sellers. With so many market players, it is impossible for any one participant to alter the prevailing price in the market. Monopoly: A monopoly is the exact opposite form of market system as perfect competition. In a pure monopoly, there is only one producer of a particular good or service, and generally no reasonable substitute. Oligopoly: An oligopoly is similar in many ways to a monopoly. The primary difference is that rather than having only one producer of a good or service, there are a handful of producers, or at least a handful of producers that make up a dominant majority of the production in the market system. Monopolistic Competition: Like a perfectly competitive market system, there are numerous competitors in the market. The difference is that each competitor is sufficiently differentiated from the others that some can charge greater prices than a perfectly competitive firm. Monopsony: Market systems are not only differentiated according to the number of suppliers in the market. They may also be differentiated according to the number of buyers. 

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