Which of the Following Statements Does Not Apply to a Market

question 209

Multiple Choice

Which of the following statements does not apply to a market economy?

• A)Firms decide whom to hire and what to produce.
• B)The "invisible hand" usually maximizes the income of society as a whole.
• C)Households decide which firms to work for and what to buy with their incomes.
• D)Government policies are the primary forces that guide the decisions of firms and households.

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Definitions:

System 2

System 2 is a concept from cognitive psychology that describes the deliberative, analytical, and conscious way of thinking, as opposed to the fast, automatic, intuitive thinking of System 1.

Package Sizes

The dimensions or volume of the container or packaging material used to encase products for distribution, sale, or storage.

Positive Outcomes

Favorable results or benefits achieved from particular actions or activities, especially in the context of decisions or policies.

Anchoring

A cognitive bias that describes the human tendency to rely too heavily on the first piece of information offered when making decisions.