Introduction to Imperfectly Competitive Markets Practice Test

A city has two markets for the same basic product. In Market 1 (wheat), there are thousands of small farms selling an identical product, each farm can sell as much as it wants at the market price, and entry is easy. In Market 2 (streaming music), four large firms sell differentiated subscription plans, each firm advertises heavily, and new firms face high fixed costs and licensing hurdles. Based on the market characteristics described, which market structure best fits Market 2?

A town has many gas stations selling a similar product, but each station sets its own price and uses branding (loyalty programs, convenience stores) to attract customers. Entry is possible but requires zoning approval and large startup costs. A separate market in the same town is the market for raw soybeans, with many farmers selling an identical product at a market price. Based on the market characteristics described, which market structure best fits the gas station market?