People benefit by participating in the market because:
A.) Resources are no longer limited.
B.) It facilitates specialization and increased consumption.
C.) Buyers and sellers have the same goals.
D.) Participants in the market do not have to make choices.
B.) It facilitates specialization and increased consumption.
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If a natural monopoly has an average cost pricing rule imposed, the rule will
A) maximize total surplus in the regulated industry. B) generate an economic loss for the regulated firm. C) reduce the consumer surplus and generate a deadweight loss when compared to a marginal cost pricing rule. D) set price below marginal cost.
If international trade is restricted by the government of a country:
a. the domestic consumers are benefited. b. the domestic producers are adversely affected. c. the domestic consumers pay higher prices for imported goods. d. the resources are equally distributed among domestic and foreign producers. e. the resources are allocated to their highest paid uses.
If a firm's long-run average total curve shows that it can produce 5,000 DVDs at an average cost of $2.00 and 15,000 DVDs at an average cost of $1.50, this is evidence of
A) diminishing returns. B) economies of scale. C) diseconomies of scale. D) the law of supply.
Critics contend that imposing a minimum wage higher than the equilibrium wage in a competitive industry would:
A. Decrease the number of workers employed in that industry B. Decrease the quantity of labor supplied to that industry C. Increase the demand for labor in the industry D. Increase employment in that industry