Capitalism is an economic system in which there is public ownership of the means of production and resource allocation is determined through markets
a. True
b. False
Indicate whether the statement is true or false
False
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Compared to a single-price monopoly, when a monopoly can perfectly price discriminate, the deadweight loss
A) increases. B) decreases. C) remains the same. D) becomes infinite. E) probably changes, but more information is needed to determine if it increases, decreases, or remains constant.
Which of the following best describes the invisible-hand concept?
A. The desires of resource suppliers and producers to further their own self-interest will automatically further the public interest. B. The nonsubstitutability of resources creates a conflict between private and public interests and calls for government intervention. C. The market system is the best system for overcoming the scarce resources-unlimited wants problem. D. Central direction by the government will improve resource allocation in a capitalistic economy.
Keesha consumes only milkshakes and burgers. Once at her consumer equilibrium, what would happen if she changed her consumption by purchasing one more milkshake and one fewer burger?
A) The marginal utility of a burger would decrease. B) The marginal utility of a milkshake would increase. C) The total utility from the consumption of both goods would decrease. D) all of the above
One disadvantage of a sole proprietorship as a form of business organization is that
a. sole proprietorships cannot lower the transaction costs associated with contracting with resource owners b. sole proprietorships are less efficient than corporations, because they are less specialized in production c. owners of sole proprietorships can lose all their personal assets if the business is sued or fails d. owners of sole proprietorships generally find it difficult to negotiate separation agreements with the other partners in the firm e. owners of sole proprietorships generally have very little control over how they operate their businesses