An Economic System That Answers the What, How, and for Whom

question 77

Multiple Choice

An economic system that answers the What, How, and For Whom questions using prices determined by the interaction of the forces of supply and demand is a:

• A) market economy.
• B) command economy.
• C) traditional economy.
• D) none of the above.

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Definitions:

Dividend Capture

An investment strategy aimed at buying stocks before the ex-dividend date and selling them shortly after, to collect dividend payouts.

Lockboxes

Banking service that speeds up collection of payments by having those payments mailed directly to a location accessible by the bank, reducing processing time.

Seasonal Fluctuations

Variations in sales, inventory levels, or business activity that regularly occur at certain times of the year due to seasons.

Corporate Bonds

Debt securities issued by corporations to fund capital improvements, expansions, or other business needs.