If the government intervenes in the market, while the market meets the efficiency conditions, then the government:
A. promotes more efficiency.
B. causes inefficiency.
C. reduces the consumer surplus only.
D. reduces the producer surplus only.
Answer: B
You might also like to view...
The price of Kenwood blender increased from ?150 to ?250. Following the increase in price, quantity demanded of the blender dropped from 500 to 400.
A perfectly competitive industry always has a perfectly elastic (flat) long-run supply curve
a. True b. False Indicate whether the statement is true or false
For an individual, opportunity costs
a. decrease as consumption increases. b. include only the monetary costs of goods and services. c. reflect resource scarcity. d. reflect the fact that wants are unlimited. e. reflect the fundamental assumption that "more is better."
Explain why the short-run aggregate supply curve has a positive slope.
What will be an ideal response?