In any economic system, scarce resources have to be allocated among competing uses. Market economies harness the forces of
a. government to allocate scarce resources.
b. supply and demand to allocate scarce resources.
c. credit cards to allocate scarce resources.
d. nature to allocate scarce resources.
b
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The existence of diseconomies of scale (size) for the firm is hypothesized to result from:
a. transportation costs b. imperfections in the labor market c. imperfections in the capital markets d. problems of coordination and control encountered by management e. All of the above
The Sultan of Brunei, one of the world's richest people, does not face the problem of scarcity
a. True b. False
Two heavy equipment manufacturers might collude in an effort to do all of the following except one. Which is the exception?
a. determine a more advantageous price and quantity b. prevent new entry into the market c. take advantage of the legal benefits that U.S. cartels receive d. increase their combined profits e. predict the behavior of other competitors in the heavy equipment market with greater certainty
The following include several reasons that government might give for using a tariff on imports? Which is not valid, in the sense that the effect described will not happen.
a. To raise government revenue. b. To help consumers. c. To raise incomes of producers. d. To respond to political pressures from import competing industries. e. To increase national welfare at the expense of foreigners.