In a free market, economic activity is coordinated by
a. central planners.
b. prices.
c. costs.
d. majority rule.
b
You might also like to view...
A person starts his own business after quitting his job in which he made $75,000. Expenses include $100,000 for wages and salaries, which includes a wage for the owner of $75,000, utilities of $5000, equipment of $50,000, and materials of $40,000
If revenues are $200,000, his accounting and economic profits are respectively A) $80,000 and $5000. B) -$70,000 and -$70,000. C) -$70,000 and $5000. D) $5000 and $5000.
Relative to a competitive market equilibrium, the profit-maximizing quantity chosen by a monopolist will result in a deadweight loss because:
A. the monopolist will produce at a quantity lower than the competitive equilibrium. B. the monopolist will produce at a quantity higher than the competitive equilibrium. C. the monopolist will charge a price lower than the competitive equilibrium. D. the monopolist will keep producing at a quantity even though the MR < MC.
Any activity designed to transfer income or wealth to a particular individual or firm at society's expense is called:
A. Patent protection B. X-inefficiency C. Price discrimination D. Rent-seeking
Complements
What will be an ideal response?