Which of the Following Is the Best Example of a Monopoly

question 13

Multiple Choice

Which of the following is the best example of a monopoly situation?

• A) A movie theater with one snack bar for popcorn and soft drinks.
• B) Jewelry stores in Paris.
• C) A farmers' market with many farmers selling sweet corn.
• D) The only Domino's Pizza in a large university town.
• E) A small town--some distance from any others--with only three drugstores.

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Definitions:

Predetermined Overhead Rate

An estimated rate used to allocate manufacturing overhead costs to individual products or job orders based on a specific activity base, such as labor hours or machine hours.

Machine-Hours

A measure of the amount of time a machine is operated within a given period.

Direct Labor-Hours

The total hours worked by employees who are directly involved in the production process.

Predetermined Overhead Rate

A rate calculated before a period begins, used to allocate estimated overhead costs to products based on a predetermined activity base.