Which of the following terms describes the situation in which too few or too many resources go to a specific economic activity because of external benefits or costs?
A) an technologically inefficient market
B) a market failure
C) a laissez-faire market
D) an external market
Answer: B) a market failure
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"If an industry's Herfindahl-Hirschman Index is below 1,000, a merger between any two firms in that industry will be disallowed." Comment on the accuracy of the previous statement
What will be an ideal response?
Refer to Figure 4-11. What is the value of consumer surplus after the imposition of the price floor?
A) $1,500 B) $2,700 C) 4,500 D) $5,700
Which of the following economic lessons should we take from developing country crises in Latin America (and elsewhere)?
A) Only that it is important to choose the right exchange rate regime. B) Only that banking is of central importance in any government. C) The order in which reform measures are implemented are irrelevant. D) It is important to choose the right exchange rate regime and banking is of central importance in any government. E) The order in which reform measures are implemented are irrelevant and banking is of central importance in any government.
An increase in demand could arise from which of the following factors
a. an increase in income b. a decrease in the price of a substitute c. an increase in the price of a complement d. all of the above