A Free Market May Produce a Misallocation of Resources Over

question 89

Multiple Choice

A free market may produce a misallocation of resources over time because

• A)the Fed manipulates interest rates.
• B)people have a "defective telescopic faculty." 
• C)private risk usually exceeds social risk.
• D)All of the above are correct.

---

Definitions:

Classified Revenue

Classified revenue involves organizing a company's revenue into distinct categories for detailed financial analysis and reporting.

Accounting Equation

The fundamental principle of accounting that states assets equal liabilities plus owner's equity.

Purchasing Supplies

The process of acquiring the goods and materials a company needs to operate.

Increases Liabilities

Refers to events or transactions that result in a rise in the amounts owed by a company, such as taking on new loans or issuing bonds.