In a perfectly competitive market,
A) firms can freely enter and exit.
B) firms sell a differentiated product.
C) transaction costs are high.
D) All of the above.
A
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What effect on the price of hiring a lawyer to draw up a will would the opportunity-cost theory predict as a consequence of legislation requiring the use of a lawyer in all real estate transactions?
A) A higher price as the market becomes flooded with lawyers. B) A higher price as lawyers find it costs them more to draw up wills C) No effect because prices are determined by demand, not by cost. D) A lower price as the market becomes flooded with lawyers E) A lower price as lawyers find they can now obtain their desired income level with lower fees
Economists believe it is feasible and desirable to reduce environmental damage to zero.
Answer the following statement true (T) or false (F)