In a World of Perfect Information, If Consumers Could Costlessly

question 85

Multiple Choice

In a world of perfect information, if consumers could costlessly contract with private contractors to produce a good and there were no economies of scale,

• A)firms would be unnecessary
• B)markets would be unnecessary
• C)consumers would be unnecessary
• D)consumers would face greater production costs
• E)firms would be more efficient than the market

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Definitions:

Sphincter

A ring-like muscle that controls the passage of substances through an opening in the body, such as the anus or esophagus.

Smooth Muscle

A type of muscle tissue which is not under conscious control, found in the walls of internal organs such as the stomach and intestines.

Humerus

The long bone in the upper arm or forelimb, extending from the shoulder to the elbow.

Cartilaginous Skeleton

A type of anatomical structure where the skeleton is made entirely of cartilage, as seen in sharks and rays.