Go to Any Kroger Supermarket and Walk to the Cereal

question 233

Multiple Choice

Go to any Kroger supermarket and walk to the cereal aisle. You will notice that four major brands-Kellogg's, Quaker, General Mills, and Post-seem to occupy most of the shelf space. These cereals are all priced about the same. There is a good deal of product differentiation as the result of licensing agreements with movie studios (Disney, DreamWorks, etc.) and through the use of different health claims. The cereal industry is an example of what type of competitive market?

• A)a pure monopoly
• B)monopolistic competition
• C)pure competition
• D)monopolistic oligopoly
• E)an oligopoly

---

Definitions:

Risk-free Rate

The theoretical return on investment with no risk of financial loss, often represented by the yield on government securities.

Exchange Rate

The price of one country's currency in terms of another, essential for currency exchange and international trade.

Inflation Rate

The speed at which the overall price level of goods and services increases, leading to a decrease in buying power.

Risk-free Rate

The expected return from an investment that carries no risk of losing money, commonly linked to government bonds.