If a Market Is Efficient, Then

question 14

Multiple Choice

If a market is efficient, then

• A) the market allocates buyers to the sellers who can produce the good at least cost.
• B) all of these answers.
• C) the quantity produced in the market maximises the sum of consumer and producer surplus.
• D) the market allocates output to the buyers that value it the most.

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Definitions:

Labeling Theory

A theory in sociology that suggests the labels or definitions applied to individuals can significantly influence their behavior and the perception of them by others, often resulting in self-fulfilling prophecies.

David Rosenhan

An American psychologist best known for his experiment that challenged the validity of psychiatric diagnoses, published as "On Being Sane in Insane Places."

Deviant

Pertaining to behavior or actions that deviate from societal norms or expectations, often leading to social stigma or sanctions.

Cash Register Honesty

The principle or practice of being truthful and accurate in the handling of cash transactions and the management of cash registers.