The Growth in the Scope of Business Enterprises for Most

question 32

Multiple Choice

The growth in the scope of business enterprises for most of the 19th and 20th centuries can be attributed to a drop in administrative costs of firms relative to the transaction costs of market.This resulted from:

• A)The monopolistic power of large firms to raise prices and push down wages
• B)Globalization
• C)The growing transaction costs of markets as a result of taxes,regulation,and litigation
• D)Innovation in information and communications technology and in management

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Definitions:

Price Ceiling

A regulatory limit on the price that can be charged for a particular good or service, intended to keep it affordable.

Ration Coupons

Physical or digital vouchers issued by governments or organizations to allow individuals to purchase a limited amount of scarce commodities, historically used during times of war or shortages.

Price Ceiling

Legislation or regulation that sets the maximum legal price a seller can charge for a product or service to prevent market prices from rising above a certain level.

Shortage

A situation in which the demand for a good or service exceeds its supply in a market.