A market failure is a situation in which
A. the market equilibrium leads to either too many or too few resources going towards producing the good or service.
B. resources are being efficiently allocated, but some companies are forced to shut down.
C. there is no free entry or exit into an industry.
D. the government must take actions to correct the failures of the market in a particular industry.
Answer: A
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From the data given in Table 3-2, the opportunity cost of increased cotton in moving from A to B is
A. 16 units of corn. B. 31 units of corn. C. 15 units of corn. D. 4 units of corn. E. 1 unit of corn.
The main effect of a decrease in labor demand that arises from a decrease in capital stock is
A) lower real wages. B) shifts in unemployment. C) a need for fewer immigrant workers. D) companies make fewer profits.
Is the national debt a burden to future generations?
a. No, as long as foreigners own a significant share of the national debt. b. No, as long as the national debt is owned purely by U.S. citizens. c. Yes, debt is always a burden to future generations. d. Yes, unless foreigners increase their share of the national debt.
The money demand curve is downward sloping because as the value of money falls people desire to hold a larger quantity of money
a. True b. False Indicate whether the statement is true or false