Markets can be missing:
A. because of a lack of accurate information between potential buyers and sellers.
B. when the production of a particular good is banned.
C. because public policy prevents the market from existing.
D. All of these are true.
Answer: D
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What will be an ideal response?
What is the difference between real and nominal GDP, and why do economists make this distinction?
What will be an ideal response?
Figure 14.4 represents the market for used 12 megapixel digital cameras. Suppose buyers are willing to pay $400 for a plum (high-quality) used digital camera and $200 for a lemon (low-quality) used digital camera. Initially buyers believe that 50% of used digital cameras in the market are lemons (low quality). Compared to the outcome with neutral expectations, how many fewer digital cameras are sold in equilibrium?
A. 90 B. 110 C. 140 D. The number of cameras sold in equilibrium is the same as the outcome with neutral expectations.
Corporations account for
A) the largest proportion of business revenues generated in the United States. B) the largest amount of taxes paid to the U.S. government. C) the largest number of firms in the United States. D) the smallest amount of revenues in the United States.