The market
A. Always provides the optimal mix of goods and services.
B. On its own may not always provide the optimal mix of goods and services.
C. Always provides a better mix of goods and services without government intervention than it does with government intervention.
D. May not produce the optimal mix of output, which is known as government failure.
Answer: B
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Figure 36-6
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In Figure 36-6, which point represents equilibrium at the lowest exchange rate?
A. E B. F C. G D. H
Which of the following conclusions is not supported by the Three-Sector-Model?
a. A higher GDP Price Index in a nation increases the ability and willingness of domestic businesses to supply goods and services, but it decreases consumers' willingness and ability to buy them. b. An increase in the supply of a nation's currency in the foreign exchange market lowers its international value. c. An increase in nation's demand for goods and services within the Keynesian range is often accompanied by a strong rise in the consumer price index. d. A decrease in nation's demand for goods and services within the Intermediate range usually leads to higher employment.
GDP is equal to
a. the market value of all final goods and services produced within a country in a given period of time. b. Y. c. C + I + G + NX. d. All of the above are correct.
When external benefits are present, the market price is ________, however when external costs are present, the market price is ________.
Fill in the blank(s) with the appropriate word(s).