The term "market" in economics refers to

A) a place where money changes hands.
B) a legal institution where exchange can take place.
C) a group of buyers and sellers of a product and the arrangement by which they come together to trade.
D) an organization which sells goods and services.


Answer: C

Economics

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If the production possibilities frontier is a straight line, then the

A. opportunity cost of producing one good is zero. B. society is capable of producing only one of the goods and not the other. C. producer can produce more of both goods simultaneously. D. law of constant opportunity costs applies.

Economics

If the expected inflation rate was 2.5%, the expected real interest rate was 4.0%, and the real interest rate turned out to be 5.1%, then the actual inflation rate equals

A) 1.4%. B) 1.5%. C) 2.6%. D) 6.5%.

Economics

What fraction of the labor force is cyclically unemployed when structural unemployment is 2 percent, frictional unemployment is 2.5 percent, seasonal unemployment is 1 percent, and the overall unemployment rate is 8 percent?

a. 2.5 percent b. 13.5 percent c. 4.5 percent d. 5.5 percent e. 8.0 percent

Economics

Classical economists and monetarists perceive

A. investors' expectations about returns on investment as unstable. B. large investment swings as responses to small changes in interest rates. C. that the best way to cure unemployment is to start a war. D. that the proper cure for unemployment is active fiscal policy.

Economics