When nations attempt to move quickly from central planning to a market system, they face the obstacle of high transaction costs in large part because
A) market systems are unnatural and require careful design.
B) people who have lived under socialism lack the basic skills a market system requires.
C) people who have long lived under socialism are not sufficiently individualistic.
D) the experience of socialism makes people distrustful of one another.
E) they lack many of the institutions that develop over time in a market system.
E
You might also like to view...
As you move along an indifference curve, your total utility increases or decreases depending on whether it's an upward or downward movement
a. True b. False Indicate whether the statement is true or false
A pollution compensation tax is chosen to
a. keep output stable while reducing pollution b. increase output in a cleaner manner c. make all users pay the same amount of tax d. drive the polluting firms out of business in the long run e. create enough government revenue to clean up the environment
When the government bans a good:
A. it makes acquiring that good illegal. B. the cost of breaking the ban changes the trade-offs consumers face. C. it is attempting to solve the nonexcludability problem. D. All of these statements are true.
Which of the following decreases in labor demand is due to a change in the price of a related resource?
A. A decline in the demand for computers in Europe reduces the demand for workers in the domestic computer industry. B. The rise of hair salons for both men and women reduces the demand for barbers. C. A decrease in the educational skills of manufacturing workers decreases the demand for such workers. D. An increase in the price of chemical equipment increases the cost of producing fertilizer, thus decreasing the demand for workers who make fertilizer.