Fill in the blank: In the economic way of thinking, ________ are the key to help people coordinate production and consumption plans
A) abundant levels of natural resources
B) well-meaning and inspired economic planners
C) market-formed prices
D) years of training in economic theory
C
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Tax reduction and simplification should ________ long-run aggregate supply and ________ aggregate demand
A) decrease; increase B) increase; decrease C) decrease; decrease D) increase; increase
Intense market competition is ________ for producers, since it_______
a. Bad; erode consumer surplus b. Bad, erode producer profits c. Good, increase the price level in the market d. Good; decrease the price level in the market
Division of labor allows people to do tasks for which they have greater natural ability
a. True b. False
Consider an unregulated monopoly in Figure 8.13. Suppose that a second firm enters the market. As a result, if a natural monopoly is inevitable in this market:
A. the demand curve facing each firm lies entirely above the long-run average cost curve. B. the demand curve facing each firm lies entirely below the long-run average cost curve. C. the demand curve facing each firm touches the long-run average cost curve at one point. D. None of these