Market failure means that
A) the strike organized by unionized employees fails to achieve its goal.
B) too many outdated products are offered for sale in the local supermarket.
C) there is overallocation or underallocation of resources to certain economic activity.
D) an unexpectedly harsh winter shuts down a factory.
C
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When housing prices ________, as they did beginning in 2006 following the housing market bubble, consumption spending on furniture, appliances, and home improvements decline as many households find it ________ to borrow against the value of their
homes. A) rise; harder B) fall; harder C) fall; easier D) rise; easier
Social forces:
a. affect the price mechanism through cultural norms. b. affect the price mechanism through the educational system. c. affect the price mechanism through scarcity. d. do not affect the price mechanism.
In order for a natural monopoly to develop, it
A. is important that the firm be very large. B. is important that the firm prices its product below cost. C. is not the absolute size of the firm but its size relative to the total market demand that is important. D. must be in the presence of government intervention.
If I own a share of stock in IBM, I own
a. only the right to vote in elections of corporate directors b. a claim to a share of IBM's assets and earnings as well as the right to demand annual dividend payments c. the right to demand annual dividend payments as well as the right to vote in elections of corporate directors d. only the right to demand annual dividend payments e. a claim to a share of IBM's assets and earnings as well as the right to vote in elections of corporate directors