The four specific sources of market failure are
A. Private goods, market power, externalities, and inequity.
B. Public goods, market power, externalities, and inequity.
C. Private goods, market goods, externalities, and inequity.
D. Public goods, market goods, externalities, and inequity.
Answer: B
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Which of the following statements is true of a perfectly competitive market?
A) Innovation is less likely in a competitive market because of free entry and exit of firms. B) Innovation is likely in a competitive market because of free entry and exit of firms. C) The firms in a competitive market invest more in R&D because they face an inelastic demand curve. D) The firms in a competitive market invest more in R&D because their demand for resources is perfectly elastic.
In the above figure, when the efficient quantity of gloves is produced, the total consumer surplus is
A) $3,000. B) $15,000. C) $22,500. D) $45,000.
Which government agency regulates futures markets?
A) SEC B) Commodity Futures Trading Commission C) Board of Trade D) the Federal Futures Agency
In economic terminology, an inferior good is a good
A) that no one will purchase. B) that doesn't work properly. C) that has no monetary value. D) for which demand increases as income decreases.