Which of the following possibly determines the allocation of goods and services in a free market?
a. The availability of raw materials
b. The cost of production
c. The level of government intervention
d. The ability of the producers to produce a differentiated product
e. The willingness and ability of consumers to pay for the product
e
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Gordon recommends that government macroeconomic policymakers focus on
A) reducing inflation to zero. B) creating a national job finding service to reduce frictional unemployment to near zero. C) creating "enterprise zones" to move jobs to areas of concentrated unemployment. D) programs to match more closely the job skills of the unemployed to those of job vacancies.
Suppose the price elasticity of supply for coffee is equal to one. 1,400 cups of coffee are supplied when its price is $4.0 per cup. If the price of coffee decreases to $3.60 per cup, its supply will: a. decrease to 1,260 cups
b. increase to 1,540 cups. c. decrease to 1,300 cups. d. remain the same at 1,400 cups.