What are the goals of an economic system? What is the criterion to measure the effectiveness of a system?
What will be an ideal response?
Every economic system is confronted with three basic issues: what to produce, how to produce, and for whom to produce. One can answer these questions using a centrally planned system, or allowing the markets to find a solution, or generating a mixed economy. Economists use the Pareto efficiency criterion to measure the effectiveness of an economic activity. According to this criterion, an economic activity is not effective if there is another allocation of resources that can make someone better off without hurting anyone else.
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A central bank ________ of domestic currency and corresponding ________ of foreign assets in the foreign exchange market leads to an equal increase in its international reserves and the monetary base, everything else held constant
A) sale; purchase B) sale; sale C) purchase; sale D) purchase; purchase
Union membership as a percentage of the civilian labor force is lower in the United States than in Germany or Japan
a. True b. False Indicate whether the statement is true or false
________ is the notion that there is a limit to the information that an economic agent, such as a manager, can comprehend and act on
a. Core competency b. Outsourcing c. Economies of scope d. Bounded rationality
If a firm produces 10 units, TC=$100 . When the firm increase its output to 15 units, TC= $150 . The firm's AVC equal to
a. $50 b. $100 c. $5 d. $10