What mechanism assures that producers use inputs efficiently?
a. governmental regulations on use of resources
b. altruism
c. the desire for profit
d. an innate desire to be efficient
e. All of the above are correct.
c
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According to the graph shown, at a price of $5, there is a:
A. shortage of 10.
B. shortage of 20.
C. shortage of 30.
D. surplus of 20.
If the inflation rate is rising, which one of the following would the Fed need to do to reduce the inflation rate?
A. Reduce reserve requirements B. Reduce margin requirements C. Encourage more discount borrowing D. Increase the federal funds rate
The exchange rate between the dollar and the euro is
a. the price of European goods relative to U.S. goods. b. the price of U.S. goods relative to European goods. c. the number of euros you get for lending one dollar to a European for a year. d. the number of euros you get for one dollar.
Which of the following statements is correct?
a. The market for capital is unlike the market for labor because the rental price of capital is unaffected by the marginal product of capital, whereas the price of labor is affected by the marginal product of labor. b. The market for capital is unlike the market for labor because the purchase price of capital is unaffected by the marginal product of capital, whereas the price of labor is affected by the marginal product of labor. c. The market for capital is like the market for labor because the rental price of capital is affected by the marginal product of capital, and the price of labor is affected by the marginal product of labor. d. Both a and b are correct.