When competition is present and private ownership rights are clearly defined and securely enforced by the legal system, business firms will have a strong incentive to
What will be an ideal response?
innovate and develop better products and lower cost production methods.
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The long-run supply curve is horizontal in a(n)
a. increasing-cost industry b. constant-cost industry c. decreasing-cost industry d. labor-intensive industry e. capital-intensive industry
Prosperity in the United States is evenly distributed across the 50 states.
Answer the following statement true (T) or false (F)
Risk diversification refers to the process by which:
A. insurance companies change the risk aversion of their clients. B. insurance companies reallocate the likelihood of catastrophes happening. C. people organize themselves in a group to collectively absorb the cost of the risk faced by each individual. D. risks are shared across many different assets or people, reducing the impact of any particular risk on any one individual.
Which of the following is true?
A. The United States spends more as a percentage of GDP than any other nation on foreign aid. B. The largest federal government purchase of goods and services is Social Security. C. Government purchases, but not transfer payments, are counted in Gross Domestic Product (GDP). D. Net interest on the national debt is only one percent of total federal government spending.