A market failure is a situation in which
A) resources are being efficiently allocated, but some companies are forced to shut down.
B) the market equilibrium leads to either too many or too few resources going towards producing the good or service.
C) the government must take actions to correct the failures of the market in a particular industry.
D) there is no free entry or exit into an industry.
Answer: B
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Assume that for whatever reason there is a manufacturing firm exhibits a constant marginal product of labor over a certain range of production
Armed with only this information what would you be able to say about the average product and total product of labor curves of this firm.
If Irene can make either four chairs or one table in an hour and Greg can make either three chairs or two tables in an hour, then
A) Irene has the absolute advantage in the production of tables. B) Greg has the absolute advantage in the production of chairs. C) Irene has the comparative advantage in the production of chairs. D) Greg has the comparative advantage in the production of chairs.
Which of the following would be most inelastic with regard to price?
a. a Samsung LCD television b. a Sony LCD television c. all LCD televisions d. Demand for all of the above would be equally elastic because none are necessities.
Secondary credit provided by the Fed is designed for:
A. foreign banks. B. banks that want to borrow without putting up collateral. C. banks who qualify for a lower interest than what is available under primary credit. D. banks that are in trouble and cannot obtain a loan from anyone else.