Of the following countries, the one that best exhibits the characteristics of a market economy is?
Broadly defined, competition involves?
independently acting buyers and sellers and freedom to enter or leave markets.
In a market economy the distribution of output will be determined primarily by?
the quantities and prices of the resources that households supply.
The market system's answer to the fundamental question "What will be produced?" is essentially?
"Goods and services that are profitable."
The market system's answer to the fundamental question "Who will get the goods and services?" is essentially?
"Those willing and able to pay for them."
The advent of DVDs threatens to eventually demolish the market for videocassettes. This is an example of?
"Under central planning, some group has to decide how to get the necessary inputs produced in the right amounts and delivered to the right places at the right time. This is a nearly impossible task without markets and profits." This quotation best identifies the?
coordination problem under central planning.
Innovation lagged in the centrally planned economies because?
enterprises resisted innovation in fear that their production targets would be raised.
The failure of Soviet central planning was reflected in?
a declining growth rate, poor quality goods, & the failure to provide promised consumer goods.
The simple circular flow model shows that?
households are on the selling side of the resource market and on the buying side of the product market.
Refer to the above diagram. Flow (1) represents? (see notes for chart)
wage, rent, interest, and profit income.
In terms of the circular flow diagram, businesses obtain revenue through the _____ market and make expenditures in the _____ market.
Refer to the above diagram. Arrows (3) and (4) represent?
incomes and consumer expenditures respectively.