Distinguish between a command-and-control economic system and a price system
What will be an ideal response?
In a command-and-control economic system, economic decisions about resource allocation are made by a central authority, such as a central government or a king or queen. Under command and control, this central authority decides what items will be produced, how will the items be produced, and who will obtain those items. In a price or market system, the what, how and for whom issues are determined via decentralized decision making among buyers and sellers in the market.
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The average total cost curve is U-shaped. At the quantity of output where average total cost is at its minimum, is the marginal cost curve above the average total cost curve, below the average total cost curve,
or intersecting the average total cost curve?
The label "discouraged worker" refers to a change of status from ________
A) employed to actively seeking employment B) unemployed to employed C) unemployed to not in the labor force D) not in the labor force to unemployed
Market failure occurs when:
A.) Market prices signal producers to produce the optimal mix of output. B.) The economy produces at a point on the production possibilities curve. C.) Producers supply the goods that earn the greatest profit. D.) An imperfection in the market mechanism prevents an optimal outcome.
Taiwan exports tools to the United States. Consumers in Taiwan will probably pay a(n) ________ price for tools with free trade than they would with a closed economy.
A. somewhat lower B. lower C. more fair D. higher