The Value of Output Is Maximized in a Competitive Market

question 10

Multiple Choice

The value of output is maximized in a competitive market because:

• A) entrepreneurs are always on the lookout to move resources into higher-value uses, in an effort to create more profit for themselves.
• B) government taxation reduces the profit-motive of entrepreneurs.
• C) social planners are better able to plan and make resource decisions when there are many buyers and sellers.
• D) it is easy for an industry dominated by a single firm to achieve economies of scale, producing output at a low-cost.

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Definitions:

Personal Construct Theory

Kelly’s description of personality in terms of cognitive processes: We are capable of interpreting behaviors and events and of using this understanding to guide our behavior and to predict the behavior of other people.

Psychoanalysis

A therapeutic approach and theory of personality developed by Sigmund Freud that emphasizes unconscious motives and conflicts as the determinants of human behavior.

Humanistic Approach

A psychological perspective that emphasizes the study of the whole person, including concepts like free will, self-efficacy, and self-actualization.

Cognitive Processes

The mental actions or processes involved in acquiring knowledge and understanding through thought, experience, and the senses.