In a market system, resources are allocated by
a. the orders of authority
b. traditional practices
c. prices
d. absolute advantage
e. production possibilities frontiers
C
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In a perfectly competitive market with 1,000 firms, each demanding 50 laborers at a wage rate of $5 per hour, the quantity demanded of labor by the industry producing for this market at this wage is
a. 25,000 workers b. 50,000 workers c. 250,000 workers d. 5,000 workers e. insufficient information to determine the quantity
When a firm faces a perfectly competitive market and buys its inputs from perfectly competitive markets, the only choice the firm has to affect its profits is to:
A. increase its selling price. B. change the quantity it produces. C. decrease the selling price. D. decrease its cost of production lower than other firms.