What is meant by consumer sovereignty?
What will be an ideal response?
Consumer sovereignty is the idea that consumers ultimately dictate what will be produced (or not produced) by choosing what to purchase (or not to purchase).
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A firm is charging a different price for each unit purchased by a consumer. This is called
A) first-degree price discrimination. B) second-degree price discrimination. C) third-degree price discrimination. D) fourth-degree price discrimination. E) fifth-degree price discrimination.
Which of the following will increase economic freedom?
a. institutions and policies supportive of voluntary exchange b. high tariff rates c. high taxes d. rapid and unpredictable inflation e. all of the above
Constructing an accurate cost-of-living index is difficult because:
A. consumers have different tastes. B. prices of different goods change by different proportions. C. prices of different goods change by the same proportions. D. real and nominal income tend to move together.
The self-correcting property of the economy means that output gaps are eventually eliminated by:
A. increasing or decreasing potential output. B. government policy. C. decreasing inflation only. D. increasing or decreasing inflation.