A market achieves allocative efficiency when:
a. total surplus is at its maximum
b. consumer surplus is at its minimum.
c. demand is perfectly elastic.
d. market concentration is maximized.
a
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During 2003-2007, the price of crude oil increased substantially on the world market. Other things constant, how will an unanticipated increase in oil prices influence the general level of prices and real output of oil-importing nations such as the United States and Japan?
a. Both real output and the general level of prices will decrease. b. Both real output and the general level of prices will increase. c. Real output will increase, and the general level of prices will decrease. d. Real output will decrease, and the general level of prices will increase.
If potential buyers of good X expect the price of good X will soon fall, then the current
A) demand for good X will rise. B) demand for good X will remain unchanged. C) demand for good X will fall. D) quantity demanded of good X will fall. E) quantity demanded of good X will rise.
A deficit in the current account
A. tends to cause a deficit in the financial account. B. is accompanied by an equal amount of surplus in the financial account or in official international reserves. C. does not affect the financial account or official international reserves. D. is the result of increasing exports and decreasing imports.
When a business is owned and operated by a single individual who receives all of the profits and is responsible for all debts, it is known as a
A) partnership. B) conglomerate. C) corporation. D) proprietorship.