A Special License Is Required to Operate a Taxi in Many

question 15

Multiple Choice

A special license is required to operate a taxi in many cities.The number of licenses is restricted.More drivers want licenses than are issued.This describes a non-perfectly competitive market because

• A) taxi services are very different.
• B) firms cannot freely enter and exit the market.
• C) transaction costs are high.
• D) the government generates revenue from the licenses.

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Definitions:

Modernization Theory

Modernization theory is a model of economic and social development that explains global inequality in terms of technological and cultural differences between nations.

Economic Underdevelopment

A state where a country lags behind in economic progress compared to industrialized nations, marked by low GDP, lack of industrialization, and poor living standards.

Western Attributes

Characteristics or qualities that are typically associated with Western societies, including values, practices, and cultural norms.

Homogeneous

Describes a group, structure, or substance that has the same or similar elements uniformly distributed throughout.