One Part of the "Informal Defence" of the Market System

question 2

Multiple Choice

One part of the "informal defence" of the market system is the argument, made forcefully by the late Milton Friedman, that free markets provide for the

• A) greatest equality in income distribution.
• B) greatest scope for international trade.
• C) decentralization of economic power.
• D) government with the highest tax revenues.
• E) greatest security for members of society.

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Definitions:

Absentee Owners

Absentee owners are individuals or entities that own a business or property but do not actively manage it or live on its premises.

Moral Hazard

A situation where the behavior of an individual or entity changes to take on more risk because they do not bear the full consequences of that risk.

Flood Control System

An infrastructure or set of measures designed to manage the water level in a given area to prevent flooding.

Premium

The amount paid for an insurance policy or the extra cost for a higher quality or feature-enhanced product or service.