Question

4) Which of the following is the best example of a perfectly competitive market? A) farming B) diamonds C) athletic shoes D) soft drinks E) electricity distribution 5) The Herfindahl-Hirschman Index for a monopoly is A)1 B) 100 C) 10,000. D) undefined. 6) amarket than in a The Herfindahl-Hirschman Index is definitely larger in a A) monopoly; perfectly competitive B) monopolistic competitive; monopoly C) perfectly competitive; monopoly D) perfectly competitive; monopolistic competitive market.

Answer 1

4)

Best example of perfectly competitive market is Farming.

There are large number of buyers and sellers in Farming sector. Products are to great extent are identical. Sellers do not influence prices of commodities and prices are decided by demand and supply forces.

Hence right answer is (A)

5)

right answer is (C)

H-Index values falls between zero and 10, 000

It can go maximum up to 10,000 if single firm dominates market. (100^2)

6)

Right answer is (A)

H - Index is larger is monopoly market than in a perfectly competitive market.