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Matthias Is Taking a Course in Political Studies

question 121

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Matthias is taking a course in political studies.He is learning about various economic philosophies that have proliferated in the past 100 years.Which term best describes the economic concept that "prosperity and democracy will flourish when market forces are unimpeded by government"?


Definitions:

Monopolistic Competition

A market structure characterized by the presence of several firms that sell similar, but slightly differentiated, products and services where each has some control over its prices.

Zero Economic Profits

A situation in perfectly competitive markets where firms earn just enough revenue to cover their total operating costs, leaving no supernormal profit.

Positive Economic Profits

The situation in which a firm's total revenues exceed its total costs, including both explicit and implicit costs, signaling that the firm is doing better than the next best alternative.

Profit

The financial gain realized when the amount earned from a business activity exceeds the expenses, costs, and taxes needed to sustain the activity.

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