Economic Explanations for Terrorism Rest on the Assumption That

question 50

Multiple Choice

Economic explanations for terrorism rest on the assumption that

• A) all terrorists are recruited from poor families.
• B) a Western-dominated, globalized economy allows for great inequalities that must be remedied, possibly by violent means.
• C) governments break the social contract with their citizens by encouraging outsourcing.
• D) terrorists are motivated by material gains.

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Definitions:

Market Failure

A situation in which the allocation of goods and services by a free market is not efficient, often justifying government intervention.

Monopoly

A monopoly exists when a single entity exclusively controls the supply of a particular good or service, often limiting competition.

Externalities

Economic side effects or consequences of commercial activities that affect other parties without being reflected in costs.

Price Mechanism

The process through which prices rise and fall as a result of changes in supply and demand, determining the allocation of resources in a market economy.