When a market is efficient:
A. there is no exchange that can make anyone better off without someone becoming worse off.
B. a central planner must be involved.
C. total surplus is zero.
D. an increase in price will reduce the deadweight loss.
A. there is no exchange that can make anyone better off without someone becoming worse off.
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The winner of a second-price sealed-bid auction pays an amount equal to ________
A) half of his bid B) the lowest bid C) the second-highest bid D) his valuation of the good
The logic behind the catch-up effect is that
a. workers in countries with low incomes will work more hours than workers in countries with high incomes. b. the capital stock in rich countries deteriorates at a higher rate because it already has a lot of capital. c. new capital adds more to production in a country that doesn't have much capital than in a country that already has much capital. d. None of the above is correct.
For interest rates to remain stable during economic contractions, the money supply would have to grow at the same rate as the demand for money
Indicate whether the statement is true or false
If a firm shuts down in the short run
A. it will lose its operating costs. B. it will incur only its explicit costs. C. its losses will be equal to zero. D. it will incur its fixed costs.