To understand how the price of a good is determined in a free market, one must account for the interests of:
A. neither buyers nor sellers.
B. only sellers.
C. buyers and sellers.
D. only buyers.
Answer: C
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Dominant price leadership exists when
A) one firm drives the others out of the market. B) the dominant firm decides how much each of its competitors can sell. C) the dominant firm establishes the price at the quantity where its MR = MC, and permits all other firms to sell all they want to sell at that price. D) the dominant firm charges the lowest price in the industry.
Japanese Prime Minister Ryutaro Hashimoto was called the "Herbert Hoover of Japan" because he
a. looked like a very distinguished politician. b. advocated vast public works to combat unemployment. c. advocated budget deficit reduction in the midst of a recession. d. advocated easier monetary policy and lower interest rates to combat recession.
The Fed cannot predict the effects of open market operations with perfect accuracy because of
a. changes in people's desires for cash. b. foreigners desire to hold U.S. dollars. c. banks' desires to hold excess reserves. d. All of the above are correct.
An advantage of a consumption tax over the present tax system is that a consumption tax
a. raises more revenues. b. would save the government millions in administrative costs. c. places more of the tax burden on the wealthy. d. does not discourage saving.