A True-False Test Consists of fiVe Questions

question 8

Multiple Choice

A true-false test consists of five questions. If you guess the answer to each question, what is the
Probability of getting all five questions correct?

• A) 0%
• B) 3.1%
• C) 6.2%
• D) 100%

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Definitions:

Allocative Inefficiency

A situation where resources are not optimally allocated according to consumer preferences, often leading to overproduction or underproduction of certain goods or services.

Monopolist

An entity that has exclusive control over the supply of a particular good or service, setting prices without facing competition.

Opportunity Cost

The cost of what you have to give up in order to choose something else.

Output

The sum of all goods or services created by an enterprise, industry, or the economy over a certain period.