The market mechanism:
A.) Works through central planning by the government.
B.) Eliminates market failures created by the government.
C.) Uses prices as a means of communication between consumers and producers.
D.) Is very inefficient since consumers cannot communicate directly with producers.
C.) Uses prices as a means of communication between consumers and producers.
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The figure illustrates the market for chairs. If the supply of chairs increases, the price of a chair ________ $40 and the quantity ________
A) will rise above; demanded will decrease B) will rise above; supplied will increase C) will fall below; demanded will increase D) will fall below; demanded will decrease
Suppose in the market for labor that the labor supply curve is perfectly inelastic. This would mean that the supply curve is vertical. Furthermore, suppose that demand is normal and downward sloping. Your textbook has explained that unemployment taxes are paid entirely by the employer (demanders). Who actually pays the tax in the scenario described above?
What will be an ideal response?
Recycling rates for aluminum, paper, and glass have been increasing in the United States.
Answer the following statement true (T) or false (F)
Refer to the above figure. All of the following are true concerning the diamond-water paradox EXCEPT
A. marginal utility of diamond consumption is relatively high. B. since the price of diamonds is high, demand is great. C. the demand for water exceeds the demand for diamonds. D. the price of diamonds exceeds the price of water.