1)One way the government can restore competitiveness in a market is through:

a) patents.

b) copyrights.

c) tariffs.

d) taxes.

e) antitrust laws.

2)In which kind of market does one see firms expend very large sums of money on high-end advertising campaigns?

a. monopoly

b. oligopoly

c. imperfect competition

d. perfect competition

e. public goods market

1)The correct answer is e) antitrust laws.

• This is because antitrust laws prevent a company in the industry from taking actions that would result in less competition in the market (e.g. the top producer acquiring the second-biggest producer). Patents and copyrights do not affect the market's competition but rather the legal environment, whereas tariffs and taxes are related to government revenue.

2)The correct answer is c. imperfect competition.

In imperfect competition, the products being produced by different firms are heterogeneous. Due to this, firms have to attract customers towards their products. They do so by engaging in expensive promotion campaigns.