Related to the Economics in Practice on page 710: Which of the following is true concerning economic development in many countries?
A. It is affected by the level of corruption.
B. It is affected by inefficiency in government.
C. As corruption falls, the cost of production often falls.
D. All of the above are true.
Answer: D
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Which of the following statements best expresses the law of diminishing marginal benefit?
A. The marginal benefit of the product increases as less of the product is consumed. B. The marginal benefit of a product decreases as less of the product is consumed. C. The total benefit from the product decreases as more of the product is consumed. D. The marginal benefit from a product increases as more of the product is consumed.
In markets with incomplete information, middlemen tend to ________ total economic surplus by ________.
A. reduce; giving misleading information B. increase; matching sellers with buyers who have high reservation prices C. increase; raising prices D. reduce; raising prices
Monopoly and monopsony markets have low barriers to entry.
a. true b. false
Which of the following observations is true?
A. Free markets will achieve all of society’s goals. B. The ability to buy goods is divided equally among consumers. C. The market leads to efficiency in production through the profit motive. D. The market system encourages firms to use inputs wastefully.