Lesson 3.5.1

3.5.1 Competition Quiz: OCR Business, Unit 3

20 questions

Written by Revision Ninja · Last reviewed 11 October 2026

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Lesson 3.5.1, Competition: 20 multiple choice questions for the OCR Business (H431), Unit 3: External influences, written with Revision Ninja.

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The 20 questions

  1. What type of market operates without a physical location, trading goods via digital platforms?

    • Non-physical market
    • Commodity market
    • Primary market
    • Physical market

  2. Which term describes the rivalry between businesses selling similar products to the same target market?

    • Competition
    • Integration
    • Conglomeration
    • Collusion

  3. What is a major financial risk for a firm operating in a highly competitive market?

    • Higher entry barriers
    • Higher brand loyalty
    • Guaranteed market share
    • Reduced profit margins

  4. Which factor acts as a significant barrier to entry for potential new firms in an industry?

    • Falling consumer demand
    • Flexible legislation
    • High start-up costs
    • Low brand loyalty

  5. What is a key barrier to exit that prevents a business from easily leaving a market?

    • High product demand
    • Short lease agreements
    • Low exit fees
    • High sunk costs

  6. How do consumers typically benefit when competition increases within a retail market?

    • Higher interest rates
    • Poorer customer service
    • Lower prices
    • Reduced choice

  7. What term defines a firm holding substantial market power and a large market share?

    • Market saturation
    • Market dominance
    • Market niche
    • Perfect competition

  8. In the UK, what market share percentage legally defines a business as having a monopoly?

    • 75% or more
    • 10% or more
    • 50% or more
    • 25% or more

  9. What occurs when two existing businesses agree to join together to form a single combined company?

    • An acquisition
    • A franchise
    • Organic growth
    • A merger

  10. What business expansion method involves buying a controlling interest in another existing enterprise?

    • Acquisition
    • Internal development
    • Joint venture
    • Organic growth

  11. What type of growth is achieved when a business expands using its own internal resources?

    • Horizontal integration
    • External growth
    • Inorganic growth
    • Organic growth

  12. Which UK regulatory body is responsible for investigating mergers that might restrict market competition?

    • FCA
    • Ofcom
    • CMA
    • Advertising Standards Authority

  13. How can a dominant firm negatively impact small competitor businesses in the same industry?

    • Lowering entry barriers
    • Squeezing profit margins
    • Increasing consumer trust
    • Raising competitor demand

  14. Which strategy allows a firm to lower unit costs by increasing its scale of production?

    • Diseconomies of scale
    • Market segmenting
    • Economies of scale
    • Predatory pricing

  15. What main advantage does a physical market offer customers compared to an online digital market?

    • Lower overhead costs
    • Infinite shelf space
    • Immediate product inspection
    • 24/7 global access

  16. Why might an existing business choose to exit an unprofitable market completely?

    • Persistent trading losses
    • Rising profit margins
    • Falling fixed costs
    • Growing customer base

  17. What threat do powerful business suppliers face when operating in a highly competitive supplier market?

    • Higher switching costs
    • Guaranteed sales growth
    • Increased profit margins
    • Reduced pricing power

  18. Which outcome is a primary goal of government regulation in competitive consumer markets?

    • Eliminating all imports
    • Restricting market entry
    • Maximising monopoly profits
    • Protecting consumer interests

  19. What is a major operational advantage for a business operating in an online non-physical market?

    • Limited target audience
    • Lower overhead expenses
    • Face-to-face customer contact
    • Higher store rent

  20. What legal protection can prevent rival firms from copying a company's innovative product design?

    • Copyright
    • Subsidy
    • Trademark
    • Patent

All OCR Business quizzes