Government regulation is best applied in cases_____
a. where the marginal benefit of the regulation is greater than the cost of the bureaucracy
b. where imposed rules can increase efficiency more than govt. production would
c. where the marginal benefit of regulation improves the cost efficiency of the producers
d. where imposed rules can increase efficiency more than a public/private partnership would
b
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Legal limits on prices will tend to cause misallocation of resources because
A. the market price does not reflect the costs of production. B. people are unable to determine their preferences at the high or low price. C. producers are able to produce less efficiently. D. consumers no longer have incentive to spend their income efficiently. E. All of these responses are correct.
In Poland’s free market, Felix Siemienas is making a fortune in cold cuts. Prices are much higher than formerly. Siemienas says, “Yes, my prices are high. If nobody buys, I bring my prices down. That is the market rule.” This “rule” best describes
A. the law of diminishing returns. B. opportunity cost. C. the law of increasing costs. D. the law of demand.
Anything that influences a good's price or the marginal physical product of labor will influence wages
a. True b. False Indicate whether the statement is true or false
Regulators often adopt policies that benefit
A. the firms regulated rather than consumers. B. consumers and injure producers. C. no one. D. only the government.