When property rights are well defined and markets are competitive, the
a. market equilibrium violates the conditions for economic efficiency.
b. market equilibrium is consistent with economic efficiency.
c. conditions necessary for economic efficiency no longer apply.
d. quantity supplied will rarely equal the quantity demanded.
B
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In the absence of externalities, what can be said about the invisible hand of the marketplace?
a) It induces people to act in a matter inconsistent with self-interest. b) It leads to a market outcome that maximizes total benefit to society. c) It increases the transaction costs of contracting between parties in an exchange. d) It is unable to resolve inherent inefficiencies in market system.
The function of money that enables individuals to exchange goods and services in a common unit of account is called:
A) medium of exchange. B) store of value. C) unit of account. D) measure of power.