Do markets solve all of society’s problems?
A. Yes, markets are efficient and work well under nearly all circumstances.
B. Yes, markets solve the problems of production and distribution.
C. No, they do not solve problems such as unemployment and inflation.
D. No, they hardly solve any problems at all.
E. Uncertain, economic theory has no answer to this question.
Answer: C
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An increase in subway fares in New York City will boost your expenditures on subway rides if
A) the supply of subway rides is elastic. B) the supply of subway rides is inelastic. C) your demand for subway rides is elastic. D) your demand for subway rides is inelastic.
The Law of Diminishing Marginal Product is defined as that part of the production function when Total Product declines.
Indicate whether the statement is true or false.
Positive externalities are created by people when they
A) add to the net real income of society. B) are altruistic or concerned for the welfare of others. C) benefit others without intending to do so. D) increase the general welfare. E) promote the happiness of others.
Which of the following represents an example of a major cartel in global markets? a. The Organization of Wheat and Corn Exporting Countries (OWCEC)
b. The Organization of Petroleum Exporting Countries (OPEC). c. The Brotherhood of Scrap Iron Exporting Countries (BSIEC). d. The Amalgamated Association of Alfalfa Producing Countries (AAAPC).