We know government failure as the notion that ________ becomes the tool of ________ and makes the allocation of resources even less efficient than before, and this is described in public choice theory.
A. the public; the government
B. government; the rent seeker
C. a natural monopoly; the government
D. government; barriers to entry
Answer: B
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In the above figure, the economy is at point a on the initial supply of loanable funds curve SLF0. What happens if the interest rate rises?
A) There is a movement to a point such as b on supply of loanable funds curve SLF0. B) The supply of loanable funds curve shifts rightward to a curve such as SLF2. C) The supply of loanable funds curve shifts leftward to a curve such as SLF1. D) none of the above
Vertical relationships can increase profits through
a. preventing firms from evading regulation b. eliminating a double-markup problem c. making the incentives of manufacturers and retailers unaligned d. preventing price discrimination
An externality is defined as
A. an opportunity cost that is not considered, which causes inefficiency. B. a social cost that affects parties external to a transaction. C. a transaction that imposes a loss on one of the parties involved. D. a “cost of doing business” that cannot be allocated to any particular good. E. the increase in cost associated with increased production.
What are some of the important questions regarding the assignment of decision rights in an organizational hierarchy?
What will be an ideal response?